Drawn-out acquisition talks may disrupt EON Capital business

Lender’s suitors need to hasten deal closure to avoid adverse investor sentiment and lowered staff morale.

The possible acquisition of EON Capital Bhd (EON Cap) by Hong Leong Bank Bhd (HLB) or other third parties may affect EON Cap’s business focus if dragged on for too long, analysts said.

“I think the deal will be a long drawn out affair. It will be even more complicated if other suitors put in a bid. This may distract the board and management from their business focus.

“All parties should try to get the deal over and done with as fast as possible,” one analyst said.

Besides HLB, it is speculated that Affin Holdings Bhd and Alliance Financial Group Bhd may be keen to bid for EON Cap.

“This makes sense as a merger with EON Cap would enlarge the scale of Affin and Alliance’s domestic business. The small banks are very competitive now and a merger would make them stronger,” she said.

In addition, the analyst pointed out that major shareholder Primus Pacific Partners (HK) Ltd would not take things sitting down.

View the full story in The Star.