Keppel vs Cuscaden: A timeline of key events for the battle over SPH's assets

Vivienne Tay

Published Thu, Feb 10, 2022 · 07:34 AM

KEPPEL Corporation BN4 and consortium Cuscaden Peak are embroiled in a takeover battle over Singapore Press Holdings' (SPH) T39 non-media assets.

Both parties had made surprise offers for the media and property group, which has since spun off its media assets into a company limited by guarantee (CLG).

Keppel is offering S$2.351 per share for SPH's non-media assets - comprising S$0.868 in cash, 0.596 Keppel Reit unit and 0.782 SPH Reit unit per SPH share. The group has said this offer is final.

Meanwhile, Cuscaden's offer - which SPH's board is recommending - offers each SPH shareholder the option of an all-cash offer of S$2.36, or S$2.40 per share comprising S$1.602 cash and 0.782 of an SPH Reit unit through a distribution-in-specie by SPH.

From contentious restrictions, bidding wars, to even getting the Securities Industry Council (SIC) involved, here is a look back at what has happened so far:

2021

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Mar 30: SPH announces a strategic review to consider options for its various businesses and to unlock and maximise long-term shareholder value; SPH's board says it believes that, with the company's media business continuing to face a challenging operating environment and outlook, SPH remains undervalued.

May 6: SPH says it will spin off its media business into a not-for-profit entity in the form of a CLG; the transfer of the media business is subject to SPH shareholders' approval at an extraordinary general meeting (EGM).

Aug 2: Keppel makes an offer for SPH's non-media businesses, valuing the group at S$3.4 billion. Under a scheme of arrangement, Keppel's wholly-owned Keppel Pegasus is offering S$2.099 apiece for SPH shares - S$0.668 in cash, 0.596 Keppel Reit unit from the offeror and 0.782 SPH Reit unit per share from SPH.

Analysts note the offer is reasonable and favour the synergies Keppel would achieve through the deal. That being said, there is some uncertainty as to whether SPH shareholders will be able to realise the full value of their shares.

Aug 4: SPH appoints Evercore Asia (Singapore) as its independent financial adviser for Keppel's proposed privatisation deal.

Aug 17: Evercore Asia (Singapore) says that directors should recommend shareholders vote in favour of the restructuring as it will prevent the company and its shareholders from incurring potentially significant and recurring losses from its media arm.

Aug 26: SPH chief executive Ng Yat Chung says various options such as privatisation or selling the media business had indeed been considered before the proposal to restructure SPH's media business was made.

Aug 31: Proxy advisory services company Glass Lewis says the anticipated benefits of SPH's media restructuring will outweigh the S$356.8 million cost involved.

Sep 10: SPH shareholders vote in favour of transferring the group's media business to a CLG.

Oct 29: A consortium comprising HPL, businessman Ong Beng Seng and 2 Temasek-linked entities make a surprise rival offer for SPH at S$2.10 per share in cash.

The consortium vehicle, Cuscaden Peak, is 40 per cent held by a HPL unit called Tiga Stars, 30 per cent held by Temasek unit CLA Real Estate Holdings, and 30 per cent held by the Mapletree group. Property group Mapletree is also a Temasek-linked entity.

Nov 1: Cuscaden says the minimum chain offer price it would have to make for each SPH Reit unit if its acquisition bid succeeds is S$0.964, fully in cash.

Nov 2: SPH shareholders voice concerns that the offers on the table so far still undervalue the company. The concerns come after Cuscaden Peak's surprise all-cash offer for SPH days before.

Nov 10: Keppel beefs up its offer for SPH to S$2.351 per share, which includes additional cash of S$0.20 per share. With the new offer, SPH shareholders will receive S$0.868 in cash, 0.596 Keppel Reit unit and 0.782 SPH Reit unit per SPH share. Keppel has said this offer is final.

Keppel chief executive Loh Chin Hua says the revised offer price reflects a change of conditions, stemming from improved financial performance and the overall economic environment since July. Discussions between Keppel and SPH in recent months also made various "business synergies" clearer.

SPH CEO Ng says the group would still consider superior offers to Keppel's - which is the best on the table at this moment.

Nov 15: Cuscaden ups the ante, offering each SPH shareholder the option of an all-cash offer of S$2.36, or S$2.40 per share comprising S$1.602 cash and 0.782 of an SPH Reit unit through a distribution-in-specie by SPH.

Nov 16: Keppel says the offer for SPH is firm and irrevocable and provides the shortest time to payout by mid-January 2022. The conglomerate has also reiterated that its offer is "firm and irrevocable".

Rival offeror Cuscaden Peak says both scheme meetings for SPH's privatisation should be held at the same time for shareholders to decide.

SPH's indicative timeline states shareholders will vote on Keppel's scheme first by Dec 8 and would only be allowed to vote on Cuscaden's scheme if Keppel is voted down. The second scheme meeting is also slated for January 2022.

Nov 21: Cuscaden Peak gets approval from the Monetary Authority of Singapore (MAS) and the Infocomm Media Development Authority (IMDA) for its SPH bid. It still needs clearance from the Foreign Investment Review Board (FIRB) of Australia.

Nov 26: Cuscaden Peak says its proposed scheme meeting "should be able to proceed expeditiously" without the 8-week restriction should any of the abovementioned events take place. Hence, SPH shareholders should vote against the Keppel scheme for Cuscaden Peak's competing offer to be brought forward.

The 8-week restriction comes as part of SPH's implementation agreement with Keppel, which prevents the former's shareholders from taking any action to hold alternative scheme meetings within 8 weeks from the date of Keppel's scheme meeting.

Nov 30: Keppel, in response to fresh queries on the attractiveness of its final offer, said its decision to waive its walk-away right was a deliberate one to improve the attractiveness of the deal amid the bidding war with Cuscaden.

Dec 1: SPH completes the transfer of its media business to a CLG. Its entire media-related business, including 2,500 employees, has been transferred to SPH Media Trust (SMT) for a nominal consideration of S$1.

Dec 2: Cuscaden waives its right to walk away from its SPH bid in the event of a material adverse effect in order to provide SPH shareholders with "greater transaction certainty". The consortium also says it has gained the final regulatory approval needed from the FIRB of Australia.

Dec 9: Keppel shareholders vote in favour of the SPH acquisition. Keppel's final offer for SPH is S$2.351 per share, consisting of S$0.868 per share in cash, 0.596 of a Keppel Reit unit and 0.782 of an SPH Reit unit.

Dec 22: SIC throws out the restriction clause in Keppel's offer that restricts SPH from holding a scheme meeting for a rival offer within 8 weeks from the Keppel scheme meeting. The move could pave the way for SPH to hold a shareholders' meeting to vote on both Keppel's and Cuscaden's offer on the same day.

2022

Feb 4: SPH Reit's management appoints PrimePartners Corporate Finance as its independent financial adviser (IFA) for a possible chain offer by consortium Cuscaden Peak.

Feb 9: SPH exercises its termination right for Keppel's offer while going ahead with preparations for shareholders to vote on Cuscaden's rival offer. The move has prompted Keppel to start arbitration proceedings against SPH.

SPH says that not all the scheme conditions set out in the implementation agreement previously signed by Keppel and SPH have been satisfied, even as the cut-off date of Feb 2, 2022, lapsed. It adds that SIC has no objections to SPH exercising the termination right.

Feb 10: Keppel says it will push on with arbitration proceedings against SPH despite the termination notice. It adds that SPH should not have consulted with SIC on the termination, "given the prevailing circumstances where the Keppel scheme should have been put to shareholders of SPH for their consideration".

READ MORE:

SPH Keppel M&A Timeline

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