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KUALA LUMPUR (March 30): Retirement Fund Inc, which is the third largest shareholder of IJM Corporation Bhd, is also rejecting an offer by Sunway Bhd for its shares in the construction giant.
The investment panel of the civil service pension fund better known as KWAP had deliberated on Sunway’s offer and decided to turn it down earlier this month, according to people familiar with the matter. KWAP has a little under 10% stake in IJM.
“The committee felt that the offer was not fair and did not value the potential of IJM,” one person said. “The panel also felt that the cash offer, which is about 10% of the offer price, is not fair.”
KWAP joins larger government-linked investment companies in rejecting Sunway’s offer for their shares of IJM. Both the Employees Provident Fund (EPF), the largest shareholder of IJM with a 21% stake, and Permodalan Nasional Bhd (PNB) that holds 13%, have rejected the deal.
IJM group chief executive officer Datuk Lee Chun Fai had publicly discussed the potential listing of the construction business and highways, as well as the possible divestment of the India toll concessions business.
With an order book of RM15.3 billion as at end-2025 and cash of RM2.3 billion, shares of IJM have been underperforming relative to other construction companies such as Gamuda Bhd and Sunway Construction Group Bhd.
On Jan 12, Sunway, which is a diversified conglomerate with interest in property, construction, education and healthcare, made a cash-and-share offer totalling RM3.15 per IJM shares. The cash portion is 10% of the offer price while Sunway will pay the rest in shares issued at RM5.65 each.
The offer is conditional upon Sunway getting more than 50% of IJM. So far, the acceptance level is just below 13% with the first closing date for the offer on April 6.
Sunway has 60 days to complete the offer from the time of dispatching the offer documents, which means the offer may be extended.
Following Sunway’s offer, IJM commissioned two independent valuations which valued the company at a price that is way above the offer of RM3.15 per share.
M&A Securities valued IJM shares at between RM5.84 and RM6.48 while RothschildCo Malaysia Sdn Bhd, which was engaged by the board, tagged the value of the company at between RM4.80 and RM5.63.
Sunway, on its part, justified that the offer of RM3.15 is in line with the weighted average target price of RM3.24 for IJM from 14 independent research houses. Sunway also noted that the offer implies an earnings multiple of close to 27 times IJM’s earnings for the year ended March 2025.
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