Timberwell Berhad: Key Insights from Independent Advice Circular on Unconditional Mandatory Take-Over Offer

Introduction

Timberwell Berhad has received an unconditional mandatory take-over offer from Quattrini Holdings Sdn Bhd (“the Offeror”), acting on behalf of its sole shareholder and director, Wong Wai Foo (“Ultimate Offeror”). This significant corporate development follows Wong Wai Foo’s acquisition of an additional 7.86% equity interest in Timberwell, raising his direct stake to 36.73% and triggering the mandatory offer threshold.

Key Offer Details

• Offeror: Quattrini Holdings Sdn Bhd (100% owned by Wong Wai Foo)
• Offer Price: RM0.90 in cash for each Offer Share not already owned by the Offeror, Ultimate Offeror, and Person Acting in Concert (PAC)
• Offer Shares: 56,154,318 shares, approximately 63.05% of Timberwell’s issued shares
• Offer Period: Open until 5:00 p.m. (Malaysian time), Thursday, 19 March 2026, unless extended or revised
• Unconditional Date: 5 March 2026 (Offer has become unconditional)

Background & Rationale

• Trigger Event: Wong Wai Foo acquired 7,000,000 Timberwell shares at RM0.90 each, increasing his direct shareholding and triggering the take-over obligation.
• Collective Shareholding: Following the acquisition and valid acceptances, the Offeror, Ultimate Offeror, and PAC now collectively control 54.95% of Timberwell.
• Objective: The acquisition is primarily to secure management control and strategic direction of Timberwell, with intentions to maintain the company’s listing status on Bursa Malaysia.

Valuation and Fairness Analysis

• Asset-Based Valuation (RNAV): The estimated Revalued Net Asset Value (RNAV) per Timberwell share is RM1.25.
• Offer Price Discount: The RM0.90 offer represents a 28% discount to the RNAV.
• Net Asset Value (NA): As of 31 December 2025, the unaudited NA per share is RM0.66. The Offer Price is a 36.36% premium to NA per share.
• Market Premium: The Offer Price is at a premium of 5.88%–27.86% over the last closing price, 5-day, 1-month, 3-month, 6-month, and 1-year VWAP up to the last trading day before the offer. As of the latest practicable date, the premium is 0.23%–0.56%.

Liquidity and Trading Considerations

• Low Liquidity: Timberwell shares have been relatively illiquid, with an average monthly traded volume over free float of only 0.55% versus the 6.44% average for the KL Industrial Products Index.
• Alternative Offer: No alternative offer has been received by the Board.
• Control: With over 54.95% held by the Offeror and PAC, they can determine the outcome of ordinary resolutions and significantly influence special resolutions at general meetings.

Board and Independent Adviser Recommendations

• Independent Adviser (NewParadigm Securities): The offer is NOT FAIR (due to significant discount to RNAV) but REASONABLE (due to premium to market, illiquidity, and control situation).
  Recommendation: ACCEPT the Offer.
• Non-Interested Directors: They concur with the independent adviser’s view and also recommend that shareholders ACCEPT the Offer.

Future Plans and Listing Status

• Business Continuity: The Offeror and Ultimate Offeror intend to continue Timberwell’s current business and management, with no immediate plans for liquidation, disposal of major assets, or redundancies.
• Potential for Strategic Changes: A review of strategy and possible business enhancements will be undertaken post-offer, potentially including diversification into IT and trading sectors.
• Listing Status: The intention is to maintain Timberwell’s listing. However, if public spread falls below 25%, the Offeror will work with the company to restore compliance within 3 months. If 90% or more shares are held by the Offeror and associates, trading may be suspended unless spread is restored.
• No Compulsory Acquisition Planned: The Offeror does not intend to invoke compulsory acquisition powers for remaining shares, even if eligible.

Financial Performance Highlights

• Recent Results: Timberwell recorded revenue of RM14.3 million (FYE 2025 unaudited), down 38% from RM23.2 million (FYE 2024). Loss after tax widened to RM0.5 million (FYE 2025) from RM0.4 million (FYE 2024), mainly due to weaker global demand and US tariffs on Malaysian wood products.
• No Dividends: No dividends have been declared since FYE 2022.
• Financial Position: As of FYE 2025, Timberwell’s net assets per share are RM0.68.
• No Material Commitments, Contingent Liabilities, or Litigation: None have been reported.

Important Considerations for Shareholders

• Decision Factors: While the offer is not fair based on asset value, the premium to market, control situation, and illiquidity make the offer reasonable. Shareholders seeking liquidity or who are wary of future uncertainty may wish to accept.
• Market Price After Offer: There is no assurance that Timberwell’s share price and trading volume will remain at current levels after the offer closes.
• Future Participation: Accepting the offer means shareholders will not participate in any future recovery or strategic changes in Timberwell.
• Monitoring Required: Shareholders are advised to monitor market prices and announcements, and consider their own financial objectives and risk profiles before making a decision.

Key Dates

• Offer Document posted: 26 February 2026
• Independent Advice Circular issued: 9 March 2026
• Offer Closing Date: 19 March 2026 (unless extended)

Next Steps for Shareholders

• Read both the Independent Advice Circular and the Offer Document thoroughly.
• Consult your professional advisers if you have any doubt about the course of action to take.
• Monitor Timberwell’s share price and market developments closely during the Offer Period.
• If considering to accept, follow the procedures set out in the Offer Document for acceptance and settlement.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors should refer to the official Independent Advice Circular, Offer Document, and seek advice from their professional advisers before making any investment decisions. The author and publisher accept no liability for any actions taken based on the information provided herein.

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