KUCHING: Tenaga Nasional Bhd’s (TNB) move to acquire Integrax Bhd (Integrax) has been viewed as strategic to acquire a stable coal supply.
Analysts also welcomed the recent news that Integrax’s second largest shareholder, Amin Halim Rasip, had accepted TNB’s offer price of RM3.25 per share.
The research arm of MIDF Amanah Investment Bank Bhd (MIDF Research) in a recent report, said, “The acquisition is seen as a strategic move by TNB to safeguard the supply chain of its coal-fired power plant operation in Manjung, Perak.
“While we think that the price tag is on the high side, we are fairly positive on this move. We believe that with majority control of the company, it will be able to steer Integrax’s business direction in line with TNB’s operational requirements.
“We view that stable coal supply is an important element to TNB’s Manjung power plants. This is particularly so as the power complex will contribute up to 18.4 per cent of peninsula’s power generation capacity when Manjung 4 and Manjung 5 start operation in 2015 and 2017 respectively.”
With Amin’s accepting the offer, TNB’s shareholding of Intergrax will surpass the 75 per cent mark in which it will unable to fulfil the public shareholding spread requirement.
MIDF Research noted that TNB does not intend to maintain Integrax’s listing status.
“Also, we believe that the rest of the minority shareholders will follow suit and accept the offer by TNB,” it added.
All in, MIDF Research remained positive on TNB’s long term prospects due to Government’s commitment with regard to the full implementation of fuel cost pass through (FCPT).
“The full implementation of FCPT will provide stability to TNB’s long term earnings,” the research firm said, adding that it reaffirmed its ‘buy’ call on the stock.