IPS owners makes voluntary conditional offer of 4.5 S cents a share to privatise firm

THE family-member owners of International Press Softcom (IPS) have made a voluntary conditional offer to delist and take it private at a final price of 4.5 Singapore cents for each share they do not own, said the printing and software package specialist in a bourse filing on Thursday.

According to the company's latest annual report for FY 2019 for the year ended Dec 2020, 13.26 per cent or 97,068,062 shares of IPS' existing share base are held by the public as at March 2020.

The consideration thus translates to a cash outlay of S$4.4 million.

The offer was made through private company ZHCC Investment Holdings, which is owned in equal parts by IPS founder Low Song Take and his wife, their son Kevin Low Ka Choon, and brothers Woo Khai San and Woo Khai Chong, who are also directors of the offeror.

The elder Mr Low is founder of IPS and serves as the company's executive director, while his son Kevin holds the position of managing director and chief executive. The Woo siblings are both executive directors of IPS with Mr Woo Khai Chong holding the additional title of vice-chairman.

Together, they are intending to delist and take IPS private in the event of a successful buyout, and believe that privatising the company will give it greater control and management flexibility to utilise and deploy available resources of IPS.

This will also facilitate the implementation of any strategic initiatives or operational changes of IPS to achieve greater efficiency and competitiveness, as well as allow IPS to save on compliance costs associated with maintaining its listed status, it said.

Existing shareholders of IPS save for the above mentioned may opt to sell their shares back to the company for cash at the offer price, or receive one new ordinary share - which is not and will not be listed on any securities exchange - in the capital of ZHCC per existing IPS share, at the issue price of 4.5 Singapore cents.

Accepting shareholders may only elect to choose one or the other, and not a combination of the two consideration options, said the group.

In its filing, IPS said its cash consideration of 4.5 Singapore cents represents a premium of 25.3 per cent, 32 per cent, 21.6 per cent and 26.8 per cent over the volume-weighted average price (VWAP) per share for the one, three, six and twelve-month period respectively, up to and including IPS' last full trading day on Wednesday.

This also represents a premium of 12.5 per cent IPS' last transacted price of four Singapore cents as at the close of Wednesday, before the company called for a trading halt on Thursday morning pending the announcement.

As such, the cash consideration presents shareholders with a "clean cash exit opportunity to realise their entire investment in (IPS) at a premium over the prevailing trading prices of the shares, without incurring brokerage and other trading costs", said the company.

Shareholders who find it difficult to exit their investments in the company due to low trading liquidity are also presented with an opportunity to do so at a price that "would not otherwise be readily available", it added.

The share price of IPS has risen fourfold since June 29 last year, before which it largely flat at about one Singapore cent. Trading of IPS shares currently remains suspended at four Singapore cents.