Riverstone, Wilton Resources substantial shareholders pare stakes

Singapore

THE Straits Times Index (STI) largely outperformed other key regional indices, even as the city-state continued to grapple with a rising coronavirus case count.

Over the course of the 5 trading sessions from Oct 22 to Oct 28, the STI advanced 0.5 per cent. The S&P/ASX 200 and the Nikkei 225 indices rose 0.2 per cent and 0.4 per cent, respectively. Over the same period, the KLCI shed 1.6 per cent while the Hang Seng Index slipped 1.8 per cent.

Market activity in terms of changes in director interests and substantial shareholdings as well as the value of share buybacks was muted.

There were 74 filings across 33 primary-listed counters for changes in director interests and substantial shareholdings for the period under review, versus 90 changes in the week that spanned Oct 15 to Oct 21.

For share buybacks, there were 20 transactions for 13 stocks collectively worth some S$6.8 million - roughly half the value of buybacks in the week before.

Riverstone Holdings

A filing to the Singapore Exchange (SGX) dated Oct 27 said Malaysia's Employment Provident Fund (EPF) trimmed its stake in glove manufacturer Riverstone Holdings on Oct 25.

EPF - which is a federal statutory body under Malaysia's Ministry of Finance - sold 1 million Riverstone shares worth a total of S$884,000, which works out to a price of S$0.884 apiece. The transaction took EPF's stake in the company down to 5.98 per cent from 6.05 per cent previously. Shares of Riverstone closed at S$0.89 on Oct 25.

EPF had previously pared its stake in Riverstone on Sep 20, selling 284,900 shares for a total of S$287,207.69. This took EPF's stake in Riverstone down to 6.98 per cent from 7 per cent previously.

Apart from Riverstone, EPF has also been cutting its stake in another glovemaker, Top Glove, over several instances in September and October this year.

The most recent sale of 200,000 Top Glove shares by EPF was announced in a filing on Oct 25.

Glove makers such as Riverstone and Top Glove have been key beneficiaries of the Covid-19 pandemic. The companies enjoyed record revenues and profits amid a surge in demand.

But with the speedy rollout of vaccines across the world, these glove manufacturers are now bracing for a decline in demand and average selling prices of gloves. Analysts generally expect an adverse impact on earnings in the near- to medium-term.

Raffles Education Corporation

The clash between Singapore tycoon Oei Hong Leong and Raffles Education Corporation (REC) continued even after Oei claimed to have sold his entire stake in REC.

On Oct 25, Oei sold about 90 million shares in the company to take his total stake in the company to just 0.78 per cent from 7.34 per cent prior.

Oei disposed of 56.2 million shares he held directly for about S$3.5 million, and another 34.2 million shares that were held by Oei Hong Leong Art Museum.

In an Oct 29 letter sent to REC's board that was also forwarded to The Business Times, Oei claimed he had sold his entire stake in REC.

He also asked REC's board to conduct an independent special audit, which he offered to fund.

Oei has been at odds with REC's chairman and chief executive Chew Hua Seng over an REC share placement that Oei claimed diluted his shareholding.

He had also sued Chew over alleged losses, claiming Chew had promised but failed to find a buyer for Oei's stake in REC. The suit was dismissed.

Meanwhile, other REC directors have been scooping up shares in the market. On Oct 22, the company's newest independent director Lim Siew Mun, who was appointed on Jul 1, picked up 1 million shares for a total price of S$72,253. This translates to a per-unit price of about S$0.072. REC shares closed at S$0.071 on Oct 22. With this, Lim's stake in REC stands at 0.072 per cent.

A separate filing on Oct 27 showed that the spouse of lead independent director Lim How Teck had acquired 1 million shares of REC on Oct 25 for a sum of S$60,500.

The deemed interest, along with his direct stake of 2 million shares, pushed his total stake in the company past the 0.2 per cent mark from just shy of 0.15 per cent previously.

REC has come under scrutiny by the Monetary Authority of Singapore and the Commercial Affairs Department with regard to a loan extended by Affin Bank to Raffles K12 and Raffles Iskandar in Malaysia.

Several company directors attended interviews with the authorities, including the chairman and chief executive Chew, and lead independent director Lim How Teck.

REC held its annual general meeting on Saturday (Oct 30). All resolutions were carried at the AGM.

Wilton Resources

Gold miner Wilton Resources has lost two substantial shareholders, Seah Cheong Leng and Ng Suk Sian, after the duo sold 77 million shares for a total of S$1.54 million on Oct 26 via an off-market transaction.

With the sale, Seah and Ng now hold a 4.99 per cent stake in the company, or some 205.4 million shares, down from a 7.98 per cent stake before.

Seah's involvement with Wilton dates back to October 2017, when Wilton secured a US$13.5 million project financing arrangement with Karl Hoffmann Mineral - a privately-owned investment and technology company specialising in gold mining in the Asia-Pacific region. Seah was the owner and chairman of Karl Hoffmann.

The financing arrangement was to fund a 500-tonne per day flotation and carbon-in-leach mineral processing facility at Wilton's Ciemas gold project in West Java, Indonesia.

Share buybacks

Global Investments was the most aggressive company in terms of share buybacks, with a total of 5 buybacks over the 5 trading sessions from Oct 22 to Oct 28. The company bought 500,000 shares on each of the trading sessions, spending a total of S$0.4 million. The unit prices of shares purchased by the company within this period ranged from S$0.15716 to S$0.15793.

Property and retail player Wing Tai Holdings has also been actively buying back shares. The company bought some 1.8 million shares for about S$3.4 million on Oct 27, and picked up another 250,000 shares on Oct 28 for a total price of S$500,000.