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LifeBrandz touts new plan to give 282 shareholders 1 consolidated share each
THE board of Catalist-listed lifestyle investor LifeBrandz, which last month unveiled plans for a 50-to-one share consolidation, said on Monday that it is now "contemplating rounding up all shareholders with fractional entitlements", a change of heart from an initial decision to disregard all such entitlements.
LifeBrandz had come under scrutiny from the bourse regulator over the revelation on Feb 5 that 282 shareholders will get nothing in the exercise, because they own fewer than 50 shares each.
Now, to a query from the bourse over the options that the board has considered to safeguard minority shareholders' interests, the board said in a filing on Monday that it had weighed alternatives such as adopting a share buyback mandate to repurchase the 282 shareholders' shares, aggregating all their fractional entitlements and paying the shareholders the proceeds of a sale on the market, or compensating the affected shareholders directly by buying them out.
But, assuming that each of the affected shareholders owns the maximum of 49 shares, the total market value of all their shares would be S$96.73 as at Feb 7, so "monetising their investment is not a meaningful exercise considering the amounts involved", the board said.
It called its new plan - to give each of the 282 shareholders one consolidated share, and to round up fractional entitlements for all investors - "a fair and appropriate balance between safeguarding the minority shareholders' interests, and business and commercial considerations".