Camel Maker to Acquire Japan Tobacco International

August 15th, 2014 00:00

Japan Tobacco International Bhd, which produces Camel and Winton cigarettes, has obtained a takeover offer of about RM808.4 million from its managing shareholder Japan Tobacco International Holding BV or approximately RM7.80 a share for the leftover shares.

Japan Tobacco will acquire the other 39.63% or 103.549 million shares. The offer price constitutes around 20% premium to its previously traded price of around RM6.50 per share and quite above the net asset value of RM1.37 per share as of December, 2013.


The stock was stopped last Friday with 193,000 shares offered, expecting the takeover bid declaration. Japan Tobacco did not present any explanation regarding the provisional takeover proposal. A week ago, JT International explained the offer does not plan to address a weakness in the share distribution as demanded by listing specifications due to the offer.

The Japanese company plans to to remove from the list the counter. TA Securities Holdings Bhd expert Mandy Teh explained taking into consideration the obstacles coping with the industry especially arising around banned cigarettes in the market, it would be better for minorities to agree to the offer. She explained the final removal from the list of JT International from Bursa Malaysia will be less difficult for Japan Tobacco to handle the business as substantial financial systems of that scale would accumulate to the parent company.

Teh reported the offer was really appealing and suggested minority shareholders to acknowledge the proposal. TA Securities’ rational valuation of the shares was around RM6. “Despite the fact that the shares had closed down at RM6.50 several days ago, the offer of RM7.80 was above the expectation of what investors can foresee taking into consideration that the shares were hanging around the RM6 region, “she explained.

Japan Tobacco International (JTI) is the global tobacco division of Japan Tobacco, the world’s third major producer of cigarettes, with a worldwide market share of approximately 10.5%. Through a 10 year interval and among other cigarette makers, JTI is the fastest developing

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