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Halcyon, Sinochem to merge natural rubber businesses

Monday, March 28, 2016 - 08:54

MAINBOARD-LISTED Halcyon Agri Corporation Limited said on Monday it will acquire Shanghai-listed Sinochem International's natural rubber business, including its 51 per cent majority stake in Singapore-listed GMG Global Ltd, trading business, and China and Malaysia processing factories.

Following completion of the transactions - subject to approval of Halcyon Agri shareholders - Sinochem will be the majority shareholder of Halcyon Agri, which will be the holding company of the expanded group.

Sinochem will acquire a 30.07 per cent shareholding in Halcyon Agri for S$0.75 per share in cash and make a mandatory general offer (MGO) to all shareholders of Halcyon Agri at the same price.

Halcyon Agri shares last traded at S$0.73 last Wednesday.

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"Certain shareholders of Halcyon Agri have also provided undertakings such that Sinochem's shareholding in Halcyon Agri following completion of the MGO will be no less than 53.98 per cent," said both parties in an announcement.

Halcyon Agri will make a voluntary general offer (VGO) for GMG Global Ltd at an exchange ratio of 0.9333 Halcyon share for each GMG Global share. The latter last traded at S$0.615 last Wednesday.

Sinochem has undertaken to accept the VGO in respect of its 51.1 per cent shareholding.

Halcyon Agri will acquire Sinochem's natural rubber processing assets in China and Malaysia and trading businesses, for a consideration of 280 million Halcyon shares.

The transaction is expected to create the world's "largest and most comprehensive natural rubber supply chain manager" with 153,000 ha of land in Africa and South-east Asia in the upstream segment, and 35 processing facilities spanning Indonesia, Thailand, Malaysia, China and Africa with a total annual processing capacity of about 1.5 million tonnes in the midstream processing segment.

Halcyon Agri on Monday requested that its trading halt be lifted.

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