SGX invests US$1.5m to take up stake in HeveaConnect

THE Singapore Exchange (SGX) will be investing US$1.5 million through its wholly-owned subsidiary Asian Gateway Investments for a 9.09 per cent stake in rubber trading platform HeveaConnect (HC).

As part of the investment, future prices of Sicom rubber contracts will be made available on HeveaConnect’s platform.

"The rubber industry’s march towards digitalisation of the value chain and shift towards sustainable rubber are key objectives that we are excited to support," said Lee Beng Hong, senior managing director and head of Fixed Income, Currencies and Commodities in  SGX.

Conversely, rubber supply chain franchise Halcyon Agri - which previously owned a majority stake in HC - will have its total equity interest reduced from 71.1 per cent to 49.9 per cent following its share disposal and new share issue by HC.

This means that HC will no longer remain a subsidiary but an associated company to Halcyon Agri.

Further, Halcyon Agri (see amendment note) also transferred shares representing 14.73 per cent of the total into a trust managed and administered by an independent trustee. The shares will be distributed to the members of Global Platform for Sustainable Natural Rubber and/or not-for-profit organisations related to the natural rubber supply chain to promote sustainability in the industry.

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The remainder of the shares are held by ITOCHU Corporation with 17.27 per cent and DBS with 9 per cent.

Both DBS and ITOCHU had earlier chosen not to exercise their options to subscribe for additional shares under their respective share subscription agreements in relation to SGX's new share uptake.

Ng Eng Kiat, managing director of Halcyon's global tyre sector platform, said: "We wish continued success for HeveaConnect in its next stage of growth, and we would like to extend our deepest gratitude to various stakeholders that have been involved since the start of the journey."

Shares of SGX closed up 1.01 per cent at S$10.03 on Wednesday, while shares of Halcyon Agri closed up 5.66 per cent at S$0.28. 

Amendment note: An earlier version of this article stated that HeveaConnect made the transfer of shares to the independent trustee. The shares were instead transferred by Halcyon Agri. The article has been amended to reflect this.