LPI sees RM90m from disposal of Public Bank shares

LPI sees RM90m from disposal of Public Bank shares
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KUALA LUMPUR (May 10): General insurance provider LPI Capital Bhd saw proceeds of RM90.02 million from the disposal of shares in Public Bank Bhd.

Both LPI and Public Bank are both controlled by local banking magnate Tan Sri Teh Hong Piow.

In a filing with Bursa Malaysia today, LPI disclosed that it has disposed of 4.72 million shares or a 0.12% stake in Public Bank through the open market at a price of RM19.0558.

Subsequent to the disposal, LPI's shareholding in Public Bank stood at 42.52 million shares or a 1.1% stake of the latter's total issued and paid-up capital.

"The rationale of the disposal is to realise tax exempt capital gains, to improve LPI group's Capital Adequacy Ratio and to support business growth. The sale proceeds will be placed into fixed deposit or invested in bonds to generate interest income," it said.

LPI said the net profit attributable to the disposal is RM2.6 million, while the original cost of investment was RM27.89 million since 1999.

Therefore, the disposal gain amounted to approximately RM72.9 million, which translates into earnings per share of about 21.95 sen per share for the financial year ending Dec 31, 2016.

LPI fell 22 sen or 1.41% to close at RM15.38 today, giving it a market capitalisation of RM5.11 billion.

Public Bank, the country's third largest bank by asset, saw its share price fall by eight sen or 0.42% to close at RM18.98, valuing it at RM73.29 billion.