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FSL Trust gets cash offer of S$0.0585 per unit from sponsor

THE sponsor of First Ship Lease (FSL) Trust has made a mandatory general offer for the shipping trust, after taking up new units in FSL Trust via the recent preferential offering.

FSL Holdings is offering S$0.0585 in cash for each FSL Trust unit, which represents a 33 per cent premium to the last transacted price per unit of S$0.044 on Thursday.

The offer also represents a 3.7 per cent premium to the volume-weighted average price per unit of S$0.0564 over the last 12 months. Trading was halted on Friday pending the announcement.

The offeror does not intend to delist FSL Trust from the Mainboard, but reserves the right to assess its options if FSL Trust's free float falls below the minimum requirement.

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FSL Holdings said it does not intend to increase the offer price save for the right to do so in a competitive situation.

Last year, vessel owner FSL Trust proposed a non-renounceable preferential offering of three rights units for every two existing units held at an issue price of S$0.045 per new unit.

As a result, FSL Holdings now controls 55.04 per cent of FSL Trust's total issued units, and approximately 49.59 per cent of the maximum potential total units.

The maximum potential total units refer to the total number of units which would be in issue if all of FSL Trust's convertible bonds were validly converted into units.

The offer is conditional upon FSL Holdings receiving acceptances amounting to more than 50 per cent of the voting rights attributable to the maximum potential total units.

FSL Trust has US$7.25 million outstanding convertible bonds, issued to VGO Special Situations I (Luxembourg) in 2018.

The convertible bonds are convertible into units at a conversion price of S$0.05644 per unit, and can be converted into new units representing about 9.91 per cent of the maximum potential total units.

FSL Holdings is offering to buy out this bondholder as well. The offer price for the convertible bonds is S$1,413.89 in cash for every US$1,000 principal amount of convertible bonds.

CEL Impetus Corporate Finance is the financial adviser to the offeror.

An offer document will be despatched within three weeks. The offer will remain open for acceptances for at least four weeks after the date of posting of the offer document.