Boustead Projects says there may not be a public market for its shares after S$0.95 offer closes
Wong Pei Ting
BOUSTEAD Projects on Wednesday (Mar 15) said there may not be a public market for shares in the company after the offer by Boustead Singapore to acquire its shares at S$0.95 apiece closes on Mar 27.
This was the company’s response to the Singapore Exchange Securities Trading (SGX-ST), which had asked what will happen to the shares held by public shareholders in the event that the shareholding interest of Boustead Singapore and its concert parties exceeds 90 per cent. The question was posed as the listed acquirer is unable to avail itself to the rights of compulsory acquisition.
Boustead Projects said that it was already set out in the independent financial adviser’s (IFA) letter that shareholders who do not accept the offer will hold shares in the company, which may be suspended from trading on the SGX-ST.
It also declared that Boustead Singapore “has no intention to undertake or support any action” to lift any trading suspension, even if it would be obliged to restore a 10 per cent free float, for example, by way of a placement, since the offer does not meet delisting conditions.
“There are limited options available to the board; namely, to request the offeror to sell down its shares, or for the company to issue new shares to public shareholders,” it added.
Boustead Projects also pointed out that any proposal involving the issuance of new shares will require the offeror to vote in favour of the relevant resolutions, and this is not within the control of the company or the board.
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This option also requires the company to find investors who are prepared to subscribe for new shares in the company, in circumstances where it is clear that the offeror intends to privatise the company, it said.
The clarifications came as the total number of shares owned, controlled or agreed to be acquired by Boustead Singapore and its concert parties as well as valid acceptances of the offer hovered close to 90 per cent. It stood at 88.54 per cent as at 6 pm on Wednesday.
Existing rules regarding delisting include the requirement that the deal’s IFA opines that the exit offer is both fair and reasonable, but the appointed IFA in this case has deemed the offer “not fair” but reasonable.
Boustead Projects, meanwhile, stated that it had no control over the offer price, nor the opinion of the IFA in respect of whether the offer is fair and reasonable.
It also said it has no control over the actions of the shareholders.
“Shareholders are free to accept or reject the offer after considering the recommendations of the independent directors as set out in the offeree circular,” it wrote.
It added that since the company had received no alternative offer or proposal, it is unable to provide other options to shareholders who do not accept the offer.
On Wednesday, shares of Boustead Singapore closed 1.2 per cent higher at S$0.84, while those of Boustead Projects closed flat at S$0.95.
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