Conglomerate Seeks Control of Automaker Perodua

Malaysian conglomerate UMW Holdings, which already holds a 38% stake in Perodua, is moving to take a controlling interest in the national automaker.

It has announced a 501 million ringgit ($127.9 million) bid to buy 50.7% of MBM Resources from Med-Bumikar Mara.

MBM owns 22.58% of Perodua.

If successful, UMW’s purchase would trigger a mandatory offer for the rest of the shares in MBM, a move that would give it a controlling stake in Perodua.

“The proposals will allow UMW to increase its strategic stake in Perodua, which continues to be the leading marque in Malaysia with successful recent launches,” UMW says in a filing with Bursa Malaysia, the Malaysian stock exchange. “UMW Holdings does not intend to maintain the listing status of MBM Resources.”

After the MBM takeover is completed, UMW says it will offer to buy PNB Equity Resources’ 10% stake in Perodua for MYR417.5 million ($106.6 million). That would value Perodua at MYR4.18 billion ($1.06 billion).

A successful offer for MBM Resources would raise UMW’s holding in Perodua to 60.6%, and completion of the deal with PNB would boost that to 70.6%.

Perodua’s other major shareholder is Daihatsu with 25%.

“The proposed acquisitions are consistent with the company’s strategy to enhance its core businesses in the automotive, equipment and manufacturing and engineering segments,” the UMW stock exchange filing says.

“It will allow the company to further improve its prospects in the automotive segment via leveraging on Perodua’s strength in the national car segment, coupled with the company’s existing presence in the non-national car segment via the Toyota marque.”

MBM, together with its subsidiaries, joint ventures and associates, is an automotive conglomerate with investments in the distribution and sale of international and local vehicle brands in Malaysia such as Perodua, Daihatsu, Hino, Mitsubishi, Volkswagen and Volvo.

MBM also manufactures automotive parts – wheels, airbags, seatbelts, steering wheels and products to mitigate noise, vibration and harshness. Its principal market is Malaysia.