Koh Boon Hwee, Novo Tellus fund propose scheme to take Sunningdale private

Singapore

SUNNINGDALE Tech's chairman Koh Boon Hwee is teaming up with Novo Tellus PE Fund 2 to make an offer for the precision plastic components manufacturer at S$1.55 in cash per share via a scheme of arrangement. This proposed acquisition was announced on Monday evening.

Mr Koh's entity, Sunrise Technology Investment Holding II, and a subsidiary of Novo Tellus PE Fund 2 hold a 64 per cent and 36 per cent stake respectively in the offeror company.

Scheme shareholders can choose between receiving S$1.55 in cash per share, or 1,550 shares in Sunrise Technology Investment Holding (Cayman), the holding company of the offeror, at S$0.001 each.

The offeror plans to delist Sunningdale should the scheme become effective and binding.

Mr Koh currently owns 15.61 per cent in Sunningdale. Yarwood Engineering & Trading, businessman Sam Goi, and CEO Khoo Boo Hor have given an irrevocable undertaking to the offeror to vote in favour of the scheme. They hold a total of 18.1 per cent of Sunningdale in all.

The offeror said that continuing global trade tensions and a rethink by customers of the effectiveness of a global supply chain that is heavily reliant on a limited number of supply nations are accelerating change in the supply of precision plastic components globally.

"As a result, to better align the Sunningdale group's operations with these changing market dynamics, Sunningdale will need to make long dated investments that may have minimal near-term payoff. It is in this context that the offeror believes a privatisation of Sunningdale will provide the business with the necessary flexibility to manage and optimise the use of Sunningdale's resources and allow Sunningdale to focus on the execution of its long-term business plan," it said.

It added that Sunningdale shares have seen generally low trading liquidity, which makes an exit difficult for shareholders. The offer price is also at a premium of about 30.6 per cent and 36.2 per cent over the volume weighted average prices of Sunningdale shares for the one- and three-month periods leading up to the deal announcement, respectively.

Deloitte & Touche Corporate Finance is the financial adviser to Sunningdale for the acquisition and scheme, while Rippledot Capital Advisers and UOB are the joint financial advisers to the offeror. Provenance Capital has been appointed as the independent financial adviser.

Shares of Sunningdale closed at S$1.68 on Monday before trade was halted before noon. The company has made a request to lift its trading halt on Tuesday morning.