Hot stock: GL hits 10-month high after Guoco Group's privatisation bid

SHARES of mainboard-listed GL Limited hit a 10-month high on Friday following news of a proposed privatisation. This came after the hotel operator lifted its trading halt during the midday break.

Guoco Group - which has a 70.84 per cent interest in GL - intends to make a voluntary conditional offer of S$0.70 per share to privatise and delist the latter.

The UK hotel operator's counter hit an intraday high of S$0.71 as at 1.10pm on Friday, up 26.8 per cent or S$0.15. The last time the counter closed near this level was on March 11, 2020.

As at 2.17pm, GL was trading 25 per cent or S$0.14 higher at S$0.70, matching Guoco Group's offer price. About 1.9 million shares changed hands at the time.

Through the proposed privatisation, GL said it will have greater management flexibility to help the company "navigate a challenging and unprecedented operating environment" driven by Covid-19, Brexit and low oil and gas prices, according to a bourse filing on Friday morning.

GL said its core business of owning and operating hotels in the UK has been severely impacted by pandemic-driven restrictions, resulting in most of the company's hotels being closed during the six-month financial period ended Dec 31, 2020.

On Wednesday, the company posted a net loss of US$19.8 million for the six months to Dec 31, 2020, against a profit of US$26.9 million in the year-ago period.