Rex Industry (KLSE:REX) advised shareholders to reject the takeover offer after deeming the offer "not fair" and "not reasonable", according to a Monday circular issued on Bursa Securities.

The company received an offer from ETA Industries to sell the remaining stake in the company not already owned by the latter at 0.10 ringgit per share.

The adviser said the offer is not reasonable because the offeror plans to maintain Rex's listing status, so shareholders can still trade their shares, but may face low liquidity risks after the offer closes.

Moreover, the offeror won't buy out the remaining shares even if they can, which may leave minority holders with market risks, it said.