Investors show lack of enthusiasm for stationery manufacturer’s plans to list units and assets in Germany, with shares falling 11.6 percent.
The Star reported that shares of Pelikan International Corp Bhd fell by 11.6 percent, or 16 sen ($0.05/€0.037) following the stationery manufacturer’s announcement of its plans to inject some of its units and assets, along with its 96.45 percent-owned Swiss-listed unit Pelikan Holding AG, into its 70.92 percent-owned Germany-listed subsidiary, Herlitz Aktiengesellschaft, earlier this week.
The move is expected to raise €266 million ($362 million), in exchange for 266 million new bearer shares of one euro each in Herlitz. However, market observers reportedly noted a “lack of enthusiasm” for the plans “as most investors did not regard it as a major catalyst for the counter”.
An analyst explained that “the corporate exercise announced by Pelikan is somewhat neutral to the company’s shares, as what investors want to see more is a solid turnaround by the company, which has been loss-making in the last three years […] in that sense, the next few quarterly results will be crucial for Pelikan to build investor confidence”.
Pelikan’s plans form part of the final stage of its reorganisation plan, and would also reportedly include “a proposed private placement of up to 50 million Herlitz shares at a minimum offer price of one euro apiece, an offer for sale by Pelikan of up to 30 million Herlitz shares, and an offer for sale by Pelikan Holding of up to 30 million Herlitz shares”, which would raise RM491.3 million ($154.2 million/€113.3 million) towards “business development, working capital and the paring down of its debts”.