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Compact Metal revives 2015 restructuring plan to trade as cement dealer
MAINBOARD-listed aluminium dealer Compact Metal Industries has brought back an old plan to transfer its listing status, in a fresh agreement inked on Friday.
The proposed internal restructuring would see Compact Metal enter a scheme of arrangement to shift its shares - and listing status - to International Cement Group, an investment holding company owned by executive directors Ma Zhaoyang and Zhang Zengtao, and set up for just such a deal.
All ordinary shares would be transferred to an International Cement unit, and each shareholder would be entitled to a new share in International Cement for every share transferred.
The move would turn Compact Metal into an indirect, wholly owned subsidiary of International Cement.
This scheme of arrangement would require the approval of a majority of the shareholders who hold at least three-quarters of the share value, at a meeting to be convened by order of the High Court.
The Compact Metal board originally planned to carry out the restructuring in 2015, but the company's approval lapsed and the agreement was shelved.
Now, "the company wishes to resume the proposed internal restructuring exercise", Compact Metal said on Friday.
It cited its "successful diversification into the cement business" as one reason - as the company has picked up a 65 per cent stake in a Tajikistan cement plant - and added that it expects to meet the requirements for an exit from the Singapore Exchange's financial entry criteria watch list.
The company said that the proposed restructuring is partly to carry on and segregate different businesses into different operating subsidiaries.
It would also achieve ease and flexibility in new acquisitions, expansions or divestments, and would ring fence the listed entity from the new company's operating entities and direct operating risks, said Compact Metal.
The new corporate structure will also give the group "greater flexibility in positioning itself to explore other possible investment opportunities, new businesses and business partnerships should they arise through the appropriate operating subsidiary", it added.
Compact Metal closed flat at 3.9 Singapore cents, before the announcement.