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Challenger Technologies releases indicative timeline for proposed delisting

CHALLENGER Technologies expects to dispatch its delisting circular as well as the exit offer letter and relevant acceptance forms on June 12, the mainboard-listed electronics retailer said in a bourse filing on Monday night.

This is according to Challenger’s indicative timeline for its proposed voluntary delisting from the Singapore Exchange (SGX) following an exit offer.

The company expects June 25 to be the last date to lodge proxy forms for the extraordinary general meeting (EGM) – when a resolution will need to be passed to approve the delisting. The EGM will likely be held on June 27, said Challenger. If the EGM resolution is passed and with SGX approval, the company will be delisted irrespective of the number of acceptances received for the exit offer.

The closing date for the exit offer is expected to be July 11, although a different date might be announced by or on behalf of the offerer, Digileap Capital.

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Challenger said on Monday that it is still in the process of obtaining a response from SGX for its application to delist. Pending SGX’s reply, the indicative timetable may be subject to change.

In March, Challenger announced that Digileap Capital is making a cash exit offer for all Challenger shares at S$0.56 apiece.

Digileap Capital is 70 per cent owned by the Loo family, and 30 per cent by Dymon Asia Private Equity.

At Challenger’s annual general meeting (AGM) on April 29, minority shareholder Pangolin Investment Management had again pressed for a higher offer price and dividend payout.

Pangolin, which owns 2.94 per cent of Challenger, released a report in March bemoaning that Digileap's offer price was too low and unfair for minority shareholders, and that Challenger should be valued by its cash flow to shareholders, in which case the fair value of the shares should be at least S$1.15, not the S$0.56 offered by Digileap.

Shareholders also criticised Challenger at the AGM for not providing a timeline for the buyout, The Straits Times reported.

Among the reasons given for the proposed delisting are that "Challenger has not carried out any exercise to raise cash funding on the SGX-ST since 2007 and is unlikely to require access to Singapore capital markets to finance its operations in the foreseeable future".

Delisting will also provide "greater operational flexibility to manage the business, optimise the use of its management and capital resources, and facilitate the implementation of any operational changes", it said in March.

DBS has been appointed financial adviser to Digileap for the delisting and exit offer.

Challenger shares were trading flat at S$0.545 as at 10.17am on Tuesday.