MAHB shares saga deepens as consortium moves closer to privatisation

The controversial bid to privatise Malaysia Airports Holdings Berhad (MAHB) remains a cause for concern amid several deadline extensions and changes to the terms, with further questions being asked about the Employees Provident Fund (EPF) and the Securities Commission's (SC) decisions.

At the centre of the controversy is Gateway Development Alliance (GDA), a consortium comprising state-owned Khazanah Nasional, EPF and BlackRock-owned Global Infrastructure Partners (GIP), which is offering to take MAHB private at RM11 per share.

Industry insiders and critics are now raising questions over the role of key individuals and institutions, alleging questionable practices in the transaction.

These include the approval of several deadline extensions by SC and the lowering of the acceptance threshold.

"Is it unusual for the SC to approve so many extensions for a general offer? The offer threshold can be changed during the transaction, which is why they keep extending the offer period," a source familiar with the capital market told MalaysiaNow.

The bid began with a voluntary general offer in May 2024 at RM11 per share, valuing MAHB at about RM18.4 billion.

Initially, the offer required a 90% acceptance threshold, but there was resistance from minority shareholders.

In response, GDA lowered the threshold to 85% and extended the deadline three times, most recently to Feb 4.

As of Jan 17, GDA has reportedly secured 86.51% of MAHB shares, exceeding the revised threshold.

This includes 41% already held by the consortium and 45.6% acquired through shareholder approval.

The consortium is now in a position to acquire further shares on the open market in order to reach the 90% threshold required for a compulsory takeover and ultimately delist MAHB from the stock exchange.

It also remained an open question whether the minority shareholders were adequately informed of their right to withdraw acceptances following the changes in offer terms.

AmInvestment Bank pointed out that shareholders who initially accepted the offer could withdraw their acceptances until Jan 28 due to the revised terms.

Critics also pointed to the RM11 per share that was not revised after the deadline extension.

“Why was the price not revised if the minorities did not accept up to 90%?” the source asked.

While the RM11 offer price was deemed “reasonable” by financial adviser Hong Leong Investment Bank, it was labelled "not fair" by some MAHB directors who advised that the offer be rejected.

EPF, one of the main members of GDA, has come under criticism for its involvement in the deal as it sold a significant portion of its MAHB shares in January 2023 at a price of about RM6.74 per share.

The pension fund is now trying to buy back the shares at RM11, with losses estimated at more than RM500 million.

The source also pointed to the fact that Second Finance Minister Amir Hamzah Azizan served as the CEO of EPF in 2021 before he was replaced by Ahmad Zulqarnain Onn in February last year.

"The finance ministry led by Prime Minister Anwar Ibrahim, has significant influence over the SC, which is its statutory body, and the ministry plays a role in appointing key personnel and approving the regulatory body’s policies and budget," the source added.