Crucial Sembmarine EGM should be in-person

I RECENTLY received a circular from Sembcorp Marine (SCM) relating to its multi-billion-dollar takeover of Keppel Offshore and Marine (KOM). An extraordinary general meeting (EGM) of shareholders is being held on Thursday (Feb 16) at 11am.

I was surprised to learn that this important meeting will be held by electronic means. Shareholders will not be able to physically attend the meeting.

As a long-standing shareholder of SCM, I am disappointed with this approach, which the company has attributed to Covid-19 risks. This reason for holding an exclusively electronic meeting does not really hold water. The Covid-19 threat has largely blown over for most countries, including Singapore. The authorities have been encouraging listed companies to hold physical-only meetings or hybrid meetings. The latter gives an option to shareholders to attend physically or via an internet connection.

SCM’s EGM is a major, transformative one. It is a reverse takeover, and following the deal Keppel management will drive the merged entity.

Given its importance, SCM board and management should have provided for shareholders to physically attend the meeting and decide how to vote after hearing the management as well as fellow shareholders.

It is vital that Singapore-listed companies make an effort to allow shareholders to attend general meetings, whether extraordinary or annual. Several reasons come to mind:

1. Physical meetings allow shareholders to interact with directors and management of the company, both during the meeting and thereafter. It is important for shareholders to know their management and physical interactions cannot be replaced by virtual connections. Serious investors want to know their companies better through personal interaction.

2. Physical meetings allow for active question-and-answer sessions at general meetings. Follow-up questions can be asked and the reactions of board members, management and other shareholders assessed more accurately. Electronic meetings are impersonal and shareholders are often dependent on the camera man and his focus on the speaker to the exclusion of others. Follow-up questions are usually not encouraged, even in live electronic meetings.

3. It is important for shareholders, big and small, to be able to interact with one another. Views are exchanged and opinions formed during informal discussions before and after physical meetings. The chat function is usually disabled in electronic meetings and so shareholders have no liaison with other vested interests. It becomes harder to make judgements on important matters concerning listed companies.

SEE ALSO

Sias queries Sembmarine on financials, board accountability relating to KOM deal

Sembmarine to hold EGM for Keppel O&M merger on Feb 16; IFA in favour of deal

Keppel shareholders vote overwhelmingly for Sembmarine, Keppel O&M’s mega merger

It is not too late for SCM to allow shareholders to attend its transformative meeting on 16th February. If securing a venue is a problem, then the meeting should be postponed, as it already has been for some time. Shareholders can wait another month, if need be, so that they can attend a proper meeting. It is the least SCM can do for its long-suffering shareholders who have seen their shares decimated to penny-stock status over the last five years.

Mano Sabnani