UPDATE 2-Carlyle offers $619 mln for QSR, topping Idaman bid

* Carlyle Asia offers 6.70 rgt/share for QSR

* Higher than Malaysian tycoon’s offer

* Analysts say higher bid unlikely

* QSR shares up 2.75 pct

(Adds analyst’s comments, valuation)

By Saumyadeb Chakrabarty

KUALA LUMPUR, Nov 25 (BestGrowthStock) – Malaysian planter Kulim
(KULM.KL: ) on Thursday said private equity firm Carlyle had
offered to acquire its majority-owned QSR Brands (QSRB.KL: ) for
about 1.94 billion ringgit ($618.8 million), topping a previous
offer from a company linked to Malaysian tycoon Halim Saad.

Carlyle Asia’s [CYL.UL] offer of 6.70 ringgit a share for
the majority owner of KFC and Pizza Hut in Malaysia is 20
percent more than Idaman Saga’s offer of 5.60 ringgit a share
earlier this week and QSR’s current stock price.

“It’s a very lucrative offer and it’s hard to imagine
somebody up that number,” said an analyst with an international
brokerage who could not be named as he is not authorised to
speak to media.

The offer values QSR at 20 times forward earnings compared
with its current valuation of about 15 times earnings.

QSR’s sale will automatically trigger a general offer for
KFC Holdings (KFCK.KL: ), the jewel in QSR’s stable of companies.

KFC, the 51 percent-owned subsidiary of QSR, owns U.S.
based Yum! Brands’ (YUM.N: ) Kentucky Fried Chicken franchises in
Malaysia and Singapore.

“It’s already a good price at 5.60 ringgit because QSR by
itself is of little value. The value of QSR lies in KFC,” said
the analyst.

“At 5.60 ringgit, it was valuing KFC at 20 times earnings.
At 6.70 ringgit, it could value KFC at about 25-26 times.”

KFC currently trades at 21 times earnings, well above the
sector average of 17.8 times. Four analysts rate it “buy” or
“strong buy” compared with two with a “sell” recommendation.


Kulim, which gets about 60 percent of its profits from its
plantations business, holds a 55 percent stake in QSR Brands.

The sale of QSR Brands will provide a quick injection of
about 1.07 billion ringgit for Kulim, which is owned by the
debt-laden Johor Corp — the investment arm of Malaysia’s Johor
state bordering Singapore.

In a statement to the local bourse, Kulim said its board
will deliberate on the offer and that Carlyle had not indicated
a time-frame for the offer.

It also said QSR and its subsidiaries will not raise
capital or declare dividend, while Carlyle conducts due
diligence on the company.

Carlyle, a U.S. buyout fund with $90.9 billion in assets
under management, has been eyeing deals in emerging markets of
Asia and Africa.

Earlier this year, it had raised an additional $2.55
billion for deals in Asia, taking the total of Carlyle capital
committed to Asia outside of Japan to more than $5 billion.

Shares of QSR were up 2.75 percent, KFC was up 0.77 percent
and Kulim shares were up more than a percent, before being
suspended for trading on the local bourse.
($1=3.135 Malaysian Ringgit)
(Reporting by Saumyadeb Chakrabarty; Editing by David Chance)

UPDATE 2-Carlyle offers $619 mln for QSR, topping Idaman bid