Chart : PDZ daily chart as of Sep 26 2014 (source: ChartNexus)
PDZ, the sizzling hot stock for the last 3 months which saw the entry of MARA as their major shareholder as well as proposed venturing into attractive 'O&G' industry had drew a lot of 'investors' into it in the hope of riding the O&G wave. The initial announcement was made on May 14 that the company will acquire 20% of Efogen Sdn Bhd from Johany Bin Jaafar for RM 18 Million. The details of the announcement can refer to the link below:
Efogen is principally involved in the chartering of vessels for oil and gas offshore support services, providing geophysical services to the oil and gas industry, trading in related information technology software and hardware apparatus as well as providing consultancy and maintenance services in related fields.
The conditional share acquisition agreement (SAA) was for a period of 60 days and further extension of 30 days has been agreed by both parties on July 14 then again another extension of 30 days on Aug 13. It is nothing unusual about extension for significant corporate proposal like this one but after 2 extensions the company again on Sep 15 announced another extension for 10 days. So as of this point, is quite reasonable for one to think that the deal should be closed in matter of days.
Then yesterday the company suddenly announced that the deal is off without any reason given. Just like that!!! Poopsss!!! So what happen to it? Why can't it went through? Don't you think the shareholders have the rights to know about it?
From the chart above, one can notice that the share price of the counter spiked after the 1st extension and peaked immediately after the 2nd extension. Looking at it, one can't help to think that whether the SAA is ever serious or just another hot air to inflate the price of the counter. All those extensions is it really for both parties to iron out the deal or just time given to the operator to distribute their shares to innocent investors. Since no more extension for the deal, I guess they must have offload most of their shares already. With all the rumours flying around linking the counter to Tan Sri Halim Saad (TSHS) and enormous potential of O&G during the run of the share price, it really looks like a classic pump and dump trick.
So what now? At least MARA still here right! Oh ya, they have sold big chunk of their shares at a good profit. But Megalink Industries Sdn Bhd still here and they are believe to be link to TSHS, so may be there is still O&G potential right? May be! who knows! But one thing I know is that the share price certainly can't be justified by the company current state.
Refer to my previous post : CNASIA : The Deal Is Off , what is interesting is that both CNASIA and PDZ had subsequently announced the end of their respective O&G deal and are both linked to TSHS by rumours during the run of their share price. Since CNASIA share price has since fall off the cliff after the announcement, I guess PDZ share price will face some serious selling pressure on coming week. How about another company that actually link to the tycoon, Sumatec. Will the Rights Issue and the acquisition of Buzachi Neft oilfield go through? I certainly hope so for the sake of the shareholders. But if, just if, the deal falls through, then how will it affect the valuation of Sumatec. This is something the shareholders need to think about.
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