Lankayan Ventures, a subsidiary of Khazanah Nasional, offloaded its entire stake in Westports Holdings, a container shipments group, on Friday.
Some 161.5 million shares were on offer between M$2.90 and M$2.92 per share, representing a 2.7% to 3.3% discount to the October 30 closing price of RM3.00, according to a term sheet.
Lankayan Ventures, wholly owned by the Malaysian state investment firm, sold its entire 4.74% stake in Westports.
Shares priced at M$2.90 per unit, the bottom of the indicative price range, with the accelerated share sale netting Lankayan M$468 million ($142.6 million).
Twenty lines participated in the deal, with the top five allocations accounting for roughly 80% of the book.
The geographic split was 50/50 between domestic Malay institutions and foreign investors. The international tranche was made up of US, UK and Asian long-only institutional investors, more skewed towards the US and the UK, sources said.
More than 90% of the investors participating in the deal were existing shareholders looking to top up on their stakes. Current investors include the controlling Gnanalingam family and Hutchinson Whampoa.
Khazanah, which has been an investor in Westports before its IPO in October 2013, sought to take advantage of solid stock market performance this year.
Westports’ shares have returned 19% up to October 30. The handler of container shipments and conventional cargo has not escaped the volatility that’s been hammering equity markets globally in the past few weeks. After peaking this year at RM3.10 on September 19, shares fell 7% up to October 16 - they have since posted gains of 5%.
Bursa Malaysia, the country’s stock exchange, has also recovered some of its losses from earlier in October. After dropping 4% from the start of the month up to October 16, it has gained back those losses.
Khazanah has owned 4.74% of Westports from the time of its IPO in October 2013. Without board representation, it seemed an ideal time to sell, sources said, noting that generally speaking, the Malaysian investment firm tends to have board representation on its larger strategic investments.
Maybank Investment Bank was the sole bank on the placement.
Westports IPO
Westports raised $624 million in an IPO in October 2013, which was Malaysia’s largest flotation at that time. The deal was regarded as an easy sell as the syndicate had locked up 80% of the deal with Malay investors and nine cornerstones, leaving very little shares available for international investors. It is now trading at 20.41 times its 2014 earnings.
The IPO at the time accounted for 23.8% of the company, with all of the shares offered by the pre-IPO investors Gnanalingam family, Hutchinson and Khazanah.
Khazanah’s assets under management stood at $32 billion as of March.
Westports handles container shipments as well as conventional cargo out of Port Klang, a deep natural harbour in the closest port to Kuala Lumpur. After Singapore, it is the second busiest port in Southeast Asia.
It accounted for 69% of the container traffic at Port Klang in 2012 and 34% of the container traffic in Malaysia for the whole year in 2011, according to data provided by Drewry Maritime Advisors.
It has 25 berths, 18 of which are connected in a straight line, which gives Westports the flexibility to deal with various sizes of vessels.
There have been 34 Southeast Asia placements year-to-date totalling $5 billion, compared with 51 deals worth $8.5 billion for the full year in 2013, according to Dealogic data. This Westports deal is the sixth largest in Malaysia so far this year, data shows.
