![]() The move came about after Bank Negara rejected EON Cap’s proposal to issue new warrants, amounting to RM29.5 million, that would be subscribed by its single largest shareholder Primus Pacific Partners. ![]() ![]() Recently, EON Cap received Bank Negara’s approval to raise up to RM1 billion in subordinated debt papers, which would constitute Tier-2 capital. The move to pay more dividends would be something that the shareholders should agree to, considering that not all of them see eye-to-eye on some matters such as beefing up the share capital. In 2006, EON Cap Securities was injected into MIMB for the latter to be an investment bank. EON Cap Securities in 2005 bought over Sime Securities that carried huge losses. SSSB, formerly known as Sime Securities Sdn Bhd, is a wholly-owned unit of MIMB, which in turn is wholly owned by EON Cap. The transfer of the unutilised tax losses was allowed a tax incentive granted under the Investment Bank Guidelines issued jointly by Bank Negara Malaysia and the Securities Commission. When contacted, an EON Cap official declined to comment.Īccording to EON Cap’s annual report for FY2008, its subsidiary, SSSB Jaya (1987) Sdn Bhd, has unutilised tax losses of RM1 billion that was transferred to MIMB. However, it is not certain if the rebranding will get the consent of all its major shareholders because such as an exercise could be expensive, say the sources. In tandem with the internal restructuring, EON Cap is also looking at a rebranding exercise, where the bank will take on a new name,” says a source. “It would result in the bank being able to pay more dividends to its shareholders. Sources say under the restructuring, which is at a preliminary stage, the group is looking at consolidating its interests in MIMB and EON Bank under one entity that would enable the banking group to utilise the tax credits. The restructuring is said to be centred on its investment banking unit, MIMB Investment Bank Bhd, which has unutilised tax credit of RM1 billion. EON Capital Bhd is looking at an internal restructuring exercise that will involve rebranding and, more importantly, result in the bank being able to pay higher dividends, say sources.
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