Controlling directors make S$0.225 a share cash offer for Dynamic Colours

Singapore

THE husband and wife who run Dynamic Colours have made a voluntary conditional offer for the mainboard-listed resin compounding firm in a bid to delist it.

Executive chairman Goh Seok Eng and her husband, chief executive officer Yeo Hock Leng, are offering S$0.225 in cash for each Dynamic Colours share, in a deal that values the company at S$47.2 million.

The offer price is a 13.6 per cent premium to S$0.198, which is the price at which the shares last changed hands on May 21. Trading in shares of Dynamic Colours had been halted on Monday morning pending the announcement.

Mdm Goh and Mr Yeo together own 23.15 per cent of Dynamic Colours. Combined with irrevocable undertakings from other shareholders to accept the offer, Mdm Goh and Mr Yeo are in control of about 86.88 per cent of the company.

Singapore-listed trading firm Intraco, which has a 41.27 per cent stake in Dynamic Colours, plans to accept the offer. The disposal is subject to shareholders' ratification at an extraordinary general meeting and Intraco would get a sum of S$19.5 million for the sale.

Nicholas Yoong, CEO of Intraco, said: "Following the disposal, the group will continue to leverage on this opportune time to explore new investments... We will also use some of these resources to maximise the potential of our existing businesses, especially our core plastics trading and provision of fire protection services."

The offer is conditional upon the offeror receiving not less than 90 per cent of the total number of issued shares as at the close of the offer. The offeror does not intend to maintain the listing status of the company. The offeror also reserves the right to reduce the acceptance condition to a lower minimum acceptance level below 90 per cent but above 50 per cent of the voting rights attributable to the total number of issued shares.

The offer represents a unique cash exit opportunity for shareholders given their low trading liquidity, United Overseas Bank said on behalf of the offeror. An offer document will be despatched to shareholders within the next three weeks.

Privatising the company will also give the management more flexibility to manage the business, optimise the use of its management and capital resources and facilitate the implementation of any operational change, UOB said.