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SBI Offshore fails to complete RTO, must make exit offer to shareholders

SBI Offshore is now required to make a cash exit offer before delisting, as the Catalist-listed firm did not complete its proposed acquisition of the Berlitz group of 12 companies by the deadline.

The Singapore Exchange (SGX) has terminated its review of the Catalist-listed firm's pre-admission notification for the proposed acquisition, SBI announced in a bourse filing on Sunday evening.

If completed, the deal would have constituted a reverse takeover of SBI, with the Berlitz group of marine offshore and solutions providers to be injected into the cash company.

One of the reasons SGX scrapped the review was that Zico Capital - SBI's sponsor and the financial adviser for the proposed acquisition - had not demonstrated Berlitz's suitability to list on the Singapore bourse.

In a letter dated Aug 25 to Zico, SGX also noted the impending deadline of Aug 31 for SBI to complete the acquisition. Moreover, the sale and purchase agreement signed in May last year between SBI and the seller, Chan Kern Miang, would lapse on Aug 31 this year.

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SGX earlier gave SBI a six-month extension of time to Aug 31 to complete the deal and to meet the requirements for a new listing.

Per SGX's directive, seeing as SBI failed to complete the proposed acquisition by Aug 31, the latter must thus proceed to make a cash exit offer, including the distribution of all monies placed in escrow, to shareholders before it is delisted.

SBI said it will look into the options to make the cash offer, and will update shareholders with further details.

In another filing late Sunday night, SBI added that it received the notification of delisting from the bourse operator on the same day.

SBI shares will be delisted only after the company has made the exit offer, which must be fair and reasonable, and SBI is required to appoint an independent financial adviser to advise and opine as such.

The company also has to inform shareholders about its plans, milestones and timeline to comply with the requirements relating to the exit offer.

Through Zico, SBI has notified the seller Mr Chan of SGX's letter and is in discussions with him on the matter.

SBI first announced in February last year that it was planning to acquire the Berlitz group for about US$36 million. The group of 12 companies, including Berlitz Offshore and Blue Ocean Services K, owns, operates and manages vessels in the oil and gas sector.

Before signing the binding term sheet for the reserve takeover, SBI had explored strategic business and investment opportunities while working to demonstrate to SGX's regulatory arm that it had a viable business to maintain its listing status.

The company called for a trading halt on Aug 26 morning. It requested to lift the halt before market open on Monday.

Trading in the company's securities will continue until Sept 30 at 5pm to provide an opportunity for SBI shareholders to exit their investment if they decide to do so, SGX stated in its delisting notification.

Trading in SBI shares will then be suspended with effect from Oct 1.

The stock last traded on Aug 19 at 3.5 Singapore cents.

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