Malaysian backers to net €184m from Kentz

Investors who rescued Irish group its largest shareholders

Canadian engineering and construction company SNC Lavalin has it would acquire Kentz Corp. Photograph: Christinne Muschi/Reuters

Canadian engineering and construction company SNC Lavalin has it would acquire Kentz Corp. Photograph: Christinne Muschi/Reuters

a
 

The Malaysian investors who stepped in 20 years ago to rescue engineering group Kentz from examinership are poised to make about €184 million if the bid tabled for the company by Canadian rival, SNC-Lavalin, succeeds. SNC-Lavalin this week offered to buy the Irish-headquartered business for 935 pence sterling a-share, valuing it at close to €1.5 billion. The price is a 33 per cent premium to the closing quote for its stock on Friday in London.

It values the 13.6 per cent stake held by Kentz’s biggest shareholder, Kerbet Ltd, at £147.7 million, just short of €184 million. Kerbet is the vehicle for board member and shareholder, Tan Sri Mohd Razali Abdul Rahman, and fellow investor, Hassan Abas.

The Malaysian businessmen rescued MF Kent from examinership in 1994. The collapse of a Spanish client, Hovissa, forced the Tipperary-based company to seek protection from its creditors. It had borrowed substantially against the revenues due under its deal with the Hovissa.

Peremba, the original vehicle used to acquire the Irish company, initially bought 60 per cent of the group, but subsequently increased this to 90 per cent. It transferred its stake to Kerbet in 2006.

In April 2012 the holding company cashed in around half itsholding in the London-listed group when it sold 15 million Kentz shares for around €80 million. Kerbet placed the shares through brokers Investec and UBS at 400 pence sterling, less than half the price now offered for the compan by SNC.

Following that sale, Kerbet stressed that it remained a firm supporter of the engineering business and had sold part of its stake as it was seeking to diversify its portfolio.

It was also the largest beneficiary when the group floated on London’s Alternative Investment Market (AIM) in 2008. Kerbet sold around 30 million shares at 115 pence.

Kerbet is split 50/50 between the two investors, who hold their shares in the holding company through two other vehicles, Covill Investment and Gigondas Real Estate.

The next largest shareholder is finance institution, Standard Life, which has 7.22 million shares. According to its 2013 annual report, executive director, Ed Power, has just over one million shares.

 

a
The Irish Times Logo
Commenting on The Irish Times has changed. To comment you must now be an Irish Times subscriber.
SUBSCRIBE
GO BACK
Error Image
The account details entered are not currently associated with an Irish Times subscription. Please subscribe to sign in to comment.
Comment Sign In

Forgot password?
The Irish Times Logo
Thank you
You should receive instructions for resetting your password. When you have reset your password, you can Sign In.
The Irish Times Logo
Please choose a screen name. This name will appear beside any comments you post. Your screen name should follow the standards set out in our community standards.
Screen Name Selection

Hello

Please choose a screen name. This name will appear beside any comments you post. Your screen name should follow the standards set out in our community standards.

The Irish Times Logo
Commenting on The Irish Times has changed. To comment you must now be an Irish Times subscriber.
SUBSCRIBE
Forgot Password
Please enter your email address so we can send you a link to reset your password.

Sign In

Your Comments
We reserve the right to remove any content at any time from this Community, including without limitation if it violates the Community Standards. We ask that you report content that you in good faith believe violates the above rules by clicking the Flag link next to the offending comment or by filling out this form. New comments are only accepted for 3 days from the date of publication.