Lung Kee (Bermuda) gets green light from SGX to voluntarily delist
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THE Singapore Exchange (SGX) has no objection to the proposed voluntary delisting of Lung Kee (Bermuda), provided it meets certain conditions, said the Hong Kong-based mould maker on Friday (Sep 22).
Lung Kee currently has a secondary listing on the mainboard of the SGX. It has a primary listing on the Stock Exchange of Hong Kong (SEHK).
The company cited a number of reasons for the proposed delisting, which it said was in the interests of its shareholders.
First, it noted that the trading volume of its shares on SGX has been “generally thin”, with the trading volume of shares on the SEHK in comparison “significantly exceeding” the company’s trading volume on the SGX.
Second, the proposed delisting will eliminate the additional administrative overhead and costs of compliance associated with having a secondary listing on the SGX. This will allow the company “to streamline its compliance obligations, reduce its legal and compliance costs, and focus its resources on its business operations”, it said.
Third, the company has not carried out any fundraising activities in Singapore since its shares were listed in 1997. Its board also believes that the primary listing on the SEHK “is sufficient to meet its future debt and equity fundraising requirements”, which will enable it to meet its operational needs and future development.
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No general meeting needs to be convened by the company to obtain shareholders’ approval for the proposed delisting. In addition, no exit alternative needs to be offered to shareholders in connection with the proposed move.
The company made an application to the SGX to seek approval for the proposed delisting, which is scheduled to take place on or about Feb 5, 2024.
In response, SGX said it has no objection to the proposed delisting, on account of several conditions being met by the company.
These include disseminating an announcement of the proposed delisting via SGXNet promptly, as well as issuing a notice to shareholders holding shares through the central depository (CDP) traded on the SGX-ST at least three months before the delisting date.
In addition, the company should clearly disclose in the notice any actions required by shareholders with regard to the proposed delisting, including any costs to be borne by them, said SGX.
The notice should also mention that CDP depositors who do not take any action during the share transfer period will have to make their own arrangements to lodge their shares with SEHK’s central clearing and settlement system (CCASS) or a relevant broker.
This is in the event that they wish to sell or trade their shares on the SEHK subsequently. Lung Kee will not bear any charges which may be charged by CCASS, or any relevant brokers in connection with the deposit of such shares into the CCASS.
The same notice also needs to be addressed to banks, which are approved by the Supplementary Retirement Scheme (SRS). It must be sent and mailed at least three months before the delisting date to the approved banks.
SGX added its confirmation that it has no objections to the proposed delisting “is not an indication of the merits of the proposed delisting”.
Should the proposed delisting go through, Lung Kee shares will be removed from the official list of the SGX and will henceforth be traded only on the SEHK. The voting rights and entitlement to dividends of the shareholders, including the CDP depositors, will not be affected by the proposed delisting, the company said.
Lung Kee will despatch the notice to CDP depositors and SRS-approved banks on or about Oct 23, 2023.
In the meantime, the company advised CDP depositors to exercise caution when dealing in the shares “and refrain from taking any action in relation to their shares, which may be prejudicial to their interests”.
Further announcements will be issued to shareholders to inform them, among other things, of the timetable for the proposed delisting, as well as the according actions to be taken by CDP depositors, it added.
Shares of Lung Kee last traded at S$0.48 on the SGX on Sep 4.
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