MRCB: Going for the Jugular?

The Employees Provident Fund (EPF) has acquired another 24.8 million shares in Malaysian Resources Corp Bhd (MRCB) since last Friday.

In a filing with Bursa Malaysia yesterday, MRCB informed that it bought these shares at  an average of  RM1.479 each.

Last week, the EPF extended a conditional general offer (GO) for the 66.2% of MRCB that it does not own after it triggered the GO following its subscription of 171.47 million MRCB rights shares late last year.

We know the error that triggered the mandatory general offer. They should have been more careful when subscribing for excess shares. Their foolhardiness caused the imbroglio.

So, now that they have fumbled big time, why are they buying more MRCB shares? Moreover they did inform the public that MRCB will not be their flagship for property development.

However, if you look at the counters where they controlled directly such as RHB and MBSB, it looks like the MRCB purchase fits right into this strategic  troika of inter-connected shares that would form the core of the property and property finance holdings of the EPF.


There is also a very strong chance that they will sell the excess MRCB shares after it has accumulated good premium values which obviously it can.

I guess in a way it will help bolster the earnings of EPF in 2010 and onwards.