Lian Beng’s Ong family makes privatisation offer at S$0.62 per share, less than half of NAV

MAINBOARD-LISTED Lian Beng’s controlling Ong family, through investment holding company OSC Capital, has made a voluntary unconditional cash offer to buy out minority shareholders at 62 Singapore cents a share.

This is less than half of Lian Beng group’s net asset value (NAV), which was about S$1.54 per share as at end-November 2022.

After the offer is completed, the company will be a wholly-owned subsidiary and delisted from the Singapore Exchange (SGX), according to a Tuesday (Apr 11) bourse filing.

Though far below the NAV, the offer consideration is 8.8 per cent higher than the counter’s last transacted price of S$0.57 on Apr 6.

It represents a 15.7 per cent premium over the volume-weighted average price (VWAP) for the shares traded in Lian Beng over the past one month. It also represents a 17.2 per cent, 18.3 per cent and 18.8 per cent premium over VWAP per share for the three-month, six-month and 12-month period respectively.

According to the filing, after the 2021 mandatory general offer, the trading volume for Lian Beng’s shares has remained generally low, with about 161,909 shares being traded on average over the one-month period.

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The offer therefore provides shareholders who struggle to exit with “a clean cash exit opportunity” to liquidate and realise their investment in the company’s shares without incurring trading costs, it said. The filing added that the company is unlikely to require access to Singapore equity capital markets to finance its operations in the foreseeable future, as it may tap other funding sources such as bank borrowings. It will thus not need to remain listed on the SGX. 

OSC Capital plans to exercise its right to compulsorily acquire all the offer shares not acquired under the offer if it receives valid acceptances in respect of not less than 90 per cent of the total number of issued shares.

The investment holding company is 51 per cent owned by Ong Pang Aik, with Ong Lay Huan holding 30 per cent; Ong Lay Koon, 13 per cent and Ong Lee Yap, 6 per cent. They, alongside Ong Phang Hoo and Ong Phang Hui, sit on its board of directors.

Ong Pang Aik, Ong Lay Huan and Ong Lay Koon are also directors of Lian Beng, which has an issued and paid-up share capital of S$83.67 million as at Apr 11. This comprises 499.7 million shares, excluding 30.1 million treasury shares.

The Ongs – including siblings Ong Pang Aik, Ong Lay Huan, Ong Lay Koon and Ong Lee Yap, as well as Ong Sek Chong & Sons and OSC Investments Capital, have executed irrevocable undertakings in favour of the offeror.

As at the announcement date, they hold some 347.6 million shares in Lian Beng, representing a 69.56 per cent stake.

Lian Beng had called for a trading halt before market open on Apr 10. Its shares last traded on Apr 6, where they closed at S$0.57. On Tuesday night, the company requested the trading halt to be lifted.