Hawaii suspended pending takeover bid

The CSE Council agreed to a request by Hawaii Hotels Public Co. Ltd. to suspend the titles for two days pending a takeover bid from Kania Holdings, a 100% subsidiary of Hawaii Constructions Ltd.

Kania has submitted a cash bid of 18 cent per share to acquire 100% of Hawaii Hotels, a three fold premium compared to its average price of 6 cent prevailing before the deal was made. In the event that the bid is successful in its present form, then the value of the bid will reach CYP 8.1 mln based on the 45 mln outstanding shares in circulation.

However, the price of the offer is substantially lower than the 60 cent book value of Hawaii as per the first half results released by the company, giving it a valuation of CYP 27 mln.

Since the start of this year, the share price of Hawaii has been languishing near 6 cent a share, and is down 17% since the beginning of the year, at a time when the CSE GENX is up more than 30%.

Based on the last trading price of 6 cent and the reported net profits of CYP 145.000 for 2004, the historic price to earnings ratio was 18 times. In 2002, HAH had reported net profits of CYP 330.000, in 2003 net profits of CYP 104.000 and in the first half of this year, the profits were CYP 129.000 compared to CYP 108.000 in the first half of 2004.