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Boardroom, Memtech suspend trading after close of privatisation offers
TWO mainboard-listed companies, corporate services firm Boardroom Limited and electronics components manufacturer Memtech, on Monday morning requested a suspension in the trading of their shares with immediate effect.
This comes after the respective voluntary conditional cash offers for both companies closed on Friday evening, past the 90 per cent delisting threshold.
For a company to remain listed on the Singapore Exchange (SGX), at least 10 per cent of its shares must be held by the public.
However, for Boardroom, the offeror – Salacca, a unit of mainboard-listed GK Goh – cannot force a compulsory buyout of dissenting shareholders, as it did not get hold of enough shares that it did not already own.
Salacca’s offer in May valued Boardroom at S$184.5 million, with GK Goh dangling S$0.88 in cash for each share. Salacca and its concert parties, which began the offer exercise with 81 per cent of Boardroom shares, have since upped their interest to 91.3 per cent.
Shareholders who did not accept the offer can still require Salacca to buy their shares at the offer price, but the offeror does not have any right to compulsorily acquire those shares.
The offeror has indicated that it plans to take Boardroom private after the loss of free float, with greater control and management flexibility after the delisting.
The Singapore Exchange (SGX) granted Boardroom a waiver from Rule 1307 of the listing manual, which requires a general meeting to obtain shareholder approval for the delisting, and for at least 75 per cent of shareholders to approve the move.
GK Goh has businesses in aged care and corporate services. Its shares were trading flat at 84.5 Singapore cents as at 10.28am on Monday.
Boardroom shares last traded at 90.5 Singapore cents on July 17.
On Memtech's part, the offer by its controlling shareholders also closed on Friday, prompting Monday’s trading suspension. Its free float fell under the 10 per cent mark last month.
In May, a consortium led by company chairman Chuang Wen Fu made a voluntary conditional offer for all Memtech shares in a bid to delist it.
The consortium offered S$1.35 in cash for each share, in a deal that valued Memtech at S$189 million. The offer price represents a premium of 23.9 per cent over Memtech's last transacted price of S$1.09 on May 10. The independent financial adviser said the offer was fair and reasonable.
Earlier this month, SGX also approved Memtech’s proposed delisting and said the firm does not need to hold an extraordinary general meeting to obtain shareholder approval for the delisting.
Shares of Memtech last traded at S$1.34 on July 23.