Update on EON Capital Merger

This morning I wrote about this : EonCap Merger?

Well, here is the first denial.

Article Entitled " EPF eyeing DRB-HICOM's stake in EON Capital"

• Subject : Article Entitled " EPF eyeing DRB-HICOM's stake in EON Capital"
  
  Contents :
  
  We refer to the query from Bursa Malaysia Securities Berhad dated 5 February 2007 on the above article published in the New Straits Times, Business Times section on 3 February 2007.
  
  We wish to inform that DRB-HICOM Berhad has announced on 6 February 2007 that the company is not in negotiation with EPF as stated in the above article.

Again?

Are you shocked that the article has been denied?

Let me ask you the productivity issue. Them folks at EON Capital nothing else to do than to reply to all these queries based on sources.

Btw Singapore Business Times carried the following article: source to article

• EON Capital poised to join race for RHB
  Two proposals from foreign suitors already under consideration
  
  By S JAYASANKARAN
  IN KUALA LUMPUR
  
  THE race to grab control of RHB Capital, Malaysia's fourth largest lender, may get even more crowded with the entry of yet another suitor.
  
  Mr Daim: He's advising international investment agency Primus Pacific Partners, one of the bidders
  Bankers familiar with the matter said EON Capital, the country's seventh largest bank, is poised to enter the fray.
  
  It isn't clear if EON has received permission from the central bank to commence negotiations with any of RHB Capital's shareholders - a requirement of Malaysian law - but that may not be difficult.
  
  Late last year, the central bank relaxed rules on bank takeovers allowing owners to negotiate simultaneously with multiple would-be partners.
  
  The multiplicity of suitors for RHB's banking services underscores the new, market driven approach preferred by the central bank to consolidate Malaysia's banking sector. And it means that RHB's shareholders could exit with the best possible price.
  
  The RHB group is now considering two separate proposals from foreign suitors.
  
  The two: Kuwait Finance House's proposal to buy Utama Banking Group's 32 per cent in RHB and a slightly more complicated offer by international investment agency Primus Pacific Partners to buy into RHB.
  
  Primus shareholders Qatar Investment Agency and the Tsai family of Taiwan are being advised in Malaysia by former finance minister Daim Zainuddin.
  
  All this is complicated by the indebtedness of the group. RHB, a financial services company, holds 65 per cent in listed RHB Capital which, in turn, holds 70 per cent of RHB Bank. But RHB itself is indebted to the tune of RM3.5 billion (S$1.6 billion), with close to RM1 billion of that due this June.
  
  The debt has to be resolved, which was why RHB's board announced a plan last week to sell its stake in RHB Capital back to shareholders in proportion to their holdings in RHB. If implemented, the plan would have raised RM3.6 billion, which could have ended the firm's debt while allowing RHB's shareholders direct exposure to the actual cash-generating unit in the group.
  
  RHB's shareholders include the Sarawak-based Utama Banking Group (32 per cent), the EPF or the Employees Provident Fund (30 per cent) and a government pension fund (10 per cent). Of the three shareholders, only Utama is talking to the foreign bidders, while the state agencies want to go ahead with the sale of RHB's stake in RHB Capital.
  
  Enter EON Capital. The bank has a clean balance sheet but is itself a takeover target because of its relatively small size. That is why EON has tried taking over other mid-size banks; its previous attempt to takeover AMMB Holdings in 2004 failed over price.
  
  The bankers said that in September last year, EON Capital proposed to take over RHB Capital through a voluntary general offer. According to them, the finance ministry was keen on the idea but the EPF balked and the proposal went nowhere. But with two foreign parties bidding for RHB, the bankers said that the EPF may have now warmed up to EON Capital's proposal. One reason is the state-owned nexus running between both the banks.
  
  RHB Bank, the group's unlisted bank, is 30 per cent owned by state investment agency Khazanah Nasional, which also has a near 20 per cent interest in EON Capital. The commonality of state interests in both banks could prompt the government to lean towards EON Capital.
  
  Meanwhile, although EON Capital is smaller than RHB Capital, its clean, almost debt free balance sheet allows it to gear up to make a takeover possible, the bankers said.
  
  They added that the EON Capital bid could also be preferred because it avoids the complications of the Kuwait Finance House offer, which is said to be more generous than the bid by Primus.
  
  The Kuwaiti bid is only for the Islamic banking portions of RHB, which means its conventional banking parts would have to be hived off. This, the bankers said, could be potentially embarrassing for the Muslim-dominated Malaysian government as it could see the EPF, say, buying back RHB's conventional banking processes while selling its Islamic banking business.