KUALA LUMPUR: The trading volume of shares in Karex Bhd, the world’s largest condom maker, surged to 64.8 million yesterday, making it the fifth most active counter on Bursa Malaysia yesterday, amid speculations that it could be a takeover target.
It is worth noting that the stock’s trading volume only averaged around 3.53 million shares in the past 200 days.
Amid the heated trading, its shares climbed as much as 6.5 sen or 13.8% to 53.5 sen, before paring half a sen to close at 53 sen, which is 12.77% higher from Tuesday’s close, and valued at RM531.29 million.
Karex, whose stock has slumped 32.9% from 79 sen apiece a year ago, is speculated to be a takeover target of Top Glove Corp Sdn Bhd, who is said to be on the lookout for merger and acquisition opportunities for its condom manufacturing business.
Top Glove’s shares, on the other hand, slipped two sen or 0.44% to close at RM4.57 yesterday, valuing the company at RM11.68 billion. The largest glove maker in the world began production of its own condom range in July 2018.
When contacted, however, Karex dismissed rumours about it being a potential takeover target of Top Glove’s.
“To the best of our knowledge, we are not aware of any truth to this rumour,” a Karex spokesman told The Edge Financial Daily. “However, should any corporation wish to acquire a substantial position in Karex, they would have to be subjected to the typical disclosure requirements that are set by Bursa Malaysia and as far as we know, no disclosure has been submitted for announcement.”
The spokesman added that Karex aims to stay in the condom manufacturing business in the long run and that the Goh family, who controls the company, has no intention of divesting their business.
Top Glove managing director Datuk Lee Kim Meow similarly brushed off the rumours. “We are not aware of such rumours involving Top Glove,” Lee said when contacted.
http://www.theedgemarkets.com/article/trading-karex-shares-heats-amid-takeover-rumours
