Malaysian tycoon fails to take Hong Leong Capital private

KUALA LUMPUR (REUTERS) - Malaysia's Hong Leong Financial Group, controlled by the country's sixth richest man Quek Leng Chan, has failed to take its 79 percent-owned investment banking arm, Hong Leong Capital Bhd, private as shareholders hold out for a better offer.

Hong Leong Financial told the stock exchange late on Monday that it acquired only a 2.24-per-cent stake, or 5.5 million shares, during the offer period, bringing its total ownership in the investment bank to just 81.3 per cent.

Hong Leong Capital's shares have traded consistently above the RM1.71 (S$0.68) per share offer price since the deal was announced on Jan 14. The stock last traded 35 per cent above the offer price at RM2.31.

Hong Leong Financial needs to own 90 per cent of the stock before it can make a mandatory general offer for the shares it does not own.

It will have to wait for six months before making a new offer, according to stock exchange regulations.