Sats directors recommend shareholders vote in favour of WFS acquisition at EGM on Jan 18
Yong Hui Ting
SATS will be holding its extraordinary general meeting (EGM) on Jan 18 for shareholders to vote on the proposed acquisition of air cargo handler Worldwide Flight Services (WFS).
The company’s directors recommended that shareholders vote in favour of the resolution at the EGM, as they believed that WFS was the “right asset of scale and reach” for the company to acquire.
Further, they said they would be taking up the full allotment of shares at the proposed rights issue – earlier announced as a way for Sats to partially fund its acquisition.
If the motion passes through, this would bring the company’s pro forma earnings per share (EPS), including amortisation of intangible assets, to -1.1 Singapore cents, or loss per share at 1.1 Singapore cents. The pro forma EPS excluding amortisation stood at 1.4 Singapore cents. The estimations on EPS were made assuming that the acquisition was completed on Apr 1, 2021.
To recap, Sats announced in September last year that it would be acquiring WFS. The acquisition is expected to cost the company S$1.8 billion – of which S$800 million is expected to be raised through a renounceable underwritten rights issue. Some S$700 million will be obtained through a term loan, plus S$320 million from the company’s internal cash.
The rights issue is expected to be launched in the first quarter of 2023, subject to “conducive market conditions” and the satisfaction of regulatory approvals. Shareholder approval is not needed for this motion.
Shares in Sats traded flat at S$2.84 on Friday.
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