KUALA LUMPUR:  Kumpulan Powernet Bhd, whose shares had surged recently, saw 20.21 million of its shares crossed at RM1 each in an offmarket deal at midday on Thursday, fueling speculation of a takeover.

Stock market data showed the share were crossed at a 17 sen premium over Wednesday's closing price of 83 sen.

Based on the shares out of 76.149 million shares, the stake represent a 26.5% stake.

On Wednesday, 2.8 million shares were traded off-market at RM1.

StarBizWeek reported the recent share price surge of company, which is involved in manufacturing of warp knitted fabric and property development, took the market by surprise.

The stock that normally draws little attention has seen its share price more than double in the last one month from about 30 sen to more than 80 sen. 

Upon a query by Bursa Malaysia, the company announced that a substantial shareholder of the company is in negotiations to dispose the shares to a potential buyer.

Based on the announcement, there is no indication of the potential sale involving a block that is big enough to warrant a takeover of the company. It also does not indicate if the proposed transaction would cause the loss-making company to turn around.

Kumpulan Powernet’s single-largest shareholder is SSF Home Builder Sdn Bhd with 10.99% followed by Datuk Lee Choon Hoon with 9.25%. Both blocks of shares do not come near the threshold to trigger a mandatory takeover.

Kumpulan Powernet’s textile business is growing but mired in an industry that operates with narrow margins. It has property investments in Liverpool in the UK that is mainly used as student accommodation.