KEN Holdings Berhad Proposes Renewal of Share Buy-Back Authority: Key Details for Investors

KEN Holdings Berhad (“KEN”) has issued a comprehensive statement to shareholders ahead of its upcoming 42^nd Annual General Meeting (AGM), scheduled for Thursday, 21 May 2026. The company seeks shareholder approval for the proposed renewal of its authority to purchase up to 10% of its own issued shares on Bursa Malaysia Securities Berhad (“Bursa Securities”). This proposal has significant implications for share value, investor returns, and market dynamics.

Key Points in the Report

• Quantum of Share Buy-Back: KEN may buy back up to 10% of the total number of issued shares. As at the latest practicable date (LPD), the company has already purchased 12,383,400 shares (held as Treasury Shares). The remaining shares available for buy-back are 6,788,600 shares, bringing the total potentially up to 10% of issued shares.
• Effective Period: If approved, the buy-back authority will be effective immediately upon passing the resolution at the AGM and will remain in force until the next AGM or until revoked/varied by shareholders.
• Source of Funds: The buy-back will be financed by internally generated funds and/or bank borrowings. Crucially, buy-backs must be made wholly out of retained earnings, which stood at approximately RM47,083,000 as of 31 December 2025.
• Treatment of Purchased Shares: The Board may decide to:
  • Cancel the shares
  • Retain as Treasury Shares (which may be subsequently cancelled, resold, or distributed as share dividends)
  • Retain part as Treasury Shares and cancel the remainder
• Pricing Regulations:
  • Buy-back price must not exceed 15% above the weighted average market price over the preceding 5 market days.
  • Resale of Treasury Shares must be at least the weighted average price, or at a discount of up to 5% subject to conditions.

Potential Impact and Price-Sensitive Information

• Advantages:
  • Efficient use of financial resources when there is no immediate need.
  • Potential strengthening of Earnings per Share (EPS) if buy-backs reduce the number of shares in circulation.
  • Opportunity for capital gains if Treasury Shares are resold at higher prices.
  • Ability to reward shareholders through share dividends.
  • May stabilize supply and demand of shares, potentially supporting share price.
• Disadvantages:
  • May reduce working capital and distributable reserves, affecting future dividends.
  • May cause the company to forgo other investment opportunities.
  • Any buy-back will reduce cash flow depending on volume and price.
• Share Capital Effects:
  • If all purchased shares are cancelled, issued share capital would decrease from 191,720,000 to 172,548,000 shares.
  • If retained as Treasury Shares, no change in issued share capital but voting and dividend rights are suspended for Treasury Shares.
• EPS and Net Assets:
  • Buy-back may positively impact EPS if fewer shares are outstanding.
  • Net asset per share may decrease if buy-back price is above net asset value, and vice versa.
  • Resale or distribution of Treasury Shares may affect net asset per share depending on resale price or dividend value.
• Shareholding Spread:
  • Public shareholding spread would drop from 31.53% to 28.82% if buy-back is implemented fully and shares are cancelled or held as Treasury Shares.
  • KEN is required to maintain a minimum public shareholding spread of 25%.
• Mandatory Takeover Implications:
  • If a Director or party acting in concert crosses a 33% threshold or increases shareholding by 2% within six months, a mandatory general offer must be made for remaining shares.
  • Exemption from this rule may be requested from the Securities Commission Malaysia (SC).
• Historical Share Prices:
  • Share prices ranged from RM0.40 to RM0.59 in the past twelve months, with the last transacted price at RM0.51.

Shareholder Action Required

• Shareholders are advised to carefully consider the proposal as it may impact share value, EPS, dividend distribution, and market liquidity.
• The Ordinary Resolution for the buy-back authority will be tabled at the AGM. Shareholders may vote in person or by proxy, with proxy forms due by Tuesday, 19 May 2026 at 10:00 a.m.

Board Recommendation

The Board of Directors has unanimously recommended shareholders vote in favor of the Proposed Renewal of Share Buy-Back Authority, citing its alignment with the best interests of the company and shareholders.

Documents for Inspection

• KEN’s Constitution
• Audited financial statements for the past two years (up to 31 December 2025)

Potential Price-Sensitive Information

• The renewal of the buy-back authority, if fully implemented, could increase EPS, reduce share capital, and potentially support share prices.
• Resale of Treasury Shares or dividend distributions may reward shareholders and impact liquidity.
• Changes in substantial shareholding percentages may trigger mandatory takeover offers.
• Any buy-back activity is likely to be closely watched by the market and could influence KEN’s share price.

Conclusion

The upcoming AGM and the vote on the Proposed Renewal of Share Buy-Back Authority are crucial events for KEN Holdings Berhad shareholders. The outcome could directly affect share value, EPS, and investor returns. Shareholders are strongly encouraged to review the company’s Annual Report, this statement, and related documents before casting their votes.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a solicitation to buy or sell any securities. Investors should consult their own financial, legal, and professional advisors before making any investment decisions. All information is derived from company documents as of the date of publication and may be subject to change.

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