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Hoe Leong vessel sale needs shareholder ratification, not approval: SGX
MAINBOARD-LISTED heavy equipment trader Hoe Leong Corp does not have to get shareholders' approval for its planned sale of two vessels, according to a waiver from the bourse operator disclosed by the company's board on Friday evening.
But the transaction must still be ratified in a general meeting to be held by Apr 30, 2020, and in fact "as soon as practicable", the Singapore Exchange (SGX) has decided.
Hoe Leong had inked conditional agreements in October to sell Arkstar Eagle 1 and Arkstar Eagle 3 for US$1.7 million in all to Allianz Offshore Shipmanagement, with the deal classed as a "major transaction" that would need a vote at an extraordinary general meeting.
But it asked for a waiver because, among other factors, it said that shareholders who together own more than 50 per cent of the company had already undertaken to green-light the deal.
It also cited the time-sensitive nature of the transaction and argued that the planned sale "is in the ordinary course of business and… represents a reduction in the risk profile of the group".
The board has now said in its update that the waiver was granted on the basis of conditions such as irrevocable undertakings from substantial shareholders representing more than 50 per cent of the company to vote in favour of the disposal.
These substantial shareholders must also continue to own more than 50 per cent of the company up to the date of the general meeting.
Hoe Leong added that it would make more announcements to shareholders "when there are material updates, as may be necessary or appropriate".
Trading in the company's shares was suspended in September, after Hoe Leong was slapped with a statutory demand from United Overseas Bank for loan payment of some S$5.7 million.
More recently, some of the firm's subsidiaries also received separate writs of summons for US$55,580 claimed by airtime service provider Can Marine Systems on Dec 2, and for roughly S$44,360, with interest and costs, from plane ticket supplier Travelcue Management.