Offer for LCD Global turns unconditional

Singapore

A CASH offer from Aspial Corp and Fragrance Group for LCD Global Investments has turned unconditional, after LCD's largest shareholder JTrust Asia agreed to accept the bid.

The latest decision by JTrust Asia to cash out of its 29.5 per cent stake in LCD marked an about-turn from its earlier intentions to expand LCD's real estate and amusement business, and to promote the property fund management business at LCD.

As at Feb 3, AF Global - the joint venture vehicle of Aspial Corp and Fragrance Group - had received valid acceptances for its offer representing 312.6 million shares or a 29.7 per cent stake in LCD Global.

This brings the total shares in LCD held by AF Global and its concert parties from 29.3 per cent before the offer to 59.6 per cent.

By crossing the 50 per cent threshold of voting rights in LCD Global based on the issued shares, AF Global's offer of 33 Singapore cents per LCD share has become unconditional in all respects.

Aspial, a property developer and jeweller is helmed by Koh Wee Seng, who is ranked Singapore's 37th richest person by Forbes. His billionaire brother Koh Wee Meng is the CEO of Fragrance Group, a developer and manager of the Fragrance chain of hotels.

There have been market speculations on why a strategic influence in LCD would be highly coveted for the Koh brothers given their property-related businesses.

Tokyo-listed finance conglomerate JTrust Co Ltd, the parent firm of JTrust Asia, issued a release on Tuesday, explaining how things have changed that prompted it to accept the offer.

JTrust said that its earlier acquisition of a 29.5 per cent stake in LCD from the founding Lum family was part of its efforts to expand its business in Asia. It had planned to start a full-fledged real estate business in South-east Asia and other countries through LCD.

But it decided to accept AF Global's offer for three reasons. Firstly, JTrust felt that "the instability of LCD management might affect not only LCD's financial results but also various stakeholders". Secondly, the offer conditions such as offer price are favourable.

Thirdly, re-allocating resources to new M&A opportunities that will create a strategic alliance in South-east Asia for JTrust will increase corporate value, JTrust said. The sale of its LCD stake is expected to yield a gain of one billion yen (S$11.46 million).

If the conditions of AF Global's offer are met, JTrust president and CEO Nobuyoshi Fujisawa and general manager Shigeyoshi Asano - who were both appointed as executive directors at LCD Global - will resign from their positions at LCD.

LCD Global shares closed trading on Wednesday at 32.5 Singapore cents, down 1.5 cents.