SK Jewellery co-founders offer S$0.15 per share in cash to privatise company

THE co-founders of SK Jewellery Group have made a voluntary conditional cash offer of S$0.15 per share for all issued and paid-up ordinary shares in the company in a bid to privatise it.

The S$0.15 per share offer price values the company at S$84 million and exceeds the highest closing price of the Catalist-listed jeweller's shares in over two years preceding the last trading day on Aug 27 before the announcement.

The offer price represents a premium of 70.5 per cent over the last traded price per share on Aug 27. It also represents a premium of 89.9 per cent, 94.8 per cent, 89.9 per cent and 54.6 per cent respectively over the volume-weighted average price per share for the one-month, three-month, six-month and 12-month periods up to and including Aug 27.

The offeror does not intend to revise the offer price - which is final, SK Jewellery said in a regulatory update on Wednesday.

The offeror - OroGreen Investment - was incorporated in Singapore on July 24, 2020 by the co-founders for the purpose of undertaking the offer. They are non-executive chairman Lim Yong Guan, chief executive Lim Yong Sheng and executive director Lim Liang Eng.

The offer is conditional upon OroGreen Investment and parties acting in concert with it achieving shareholding of not less than 90 per cent as at the close of the offer.

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The co-founders and shareholder Soo Kee Capital - which is wholly-owned by the former - have provided undertakings to OroGreen Investment to tender all their respective shares in acceptance of the offer. Together, they hold about 82.6 per cent of the total number of issued shares.

SK Jewellery said the offer presents shareholders with a clean cash exit opportunity to realise their investment in the shares at a premium over prevailing trading prices without incurring brokerage and other trading costs. The trading volume of the shares has also been low.

The offeror believes privatising the company will provide the offeror and the company with greater control and management flexibility to manage the group's business, respond to changing market conditions and optimise the use of the company's management and resources.

Moreover, the company has not carried out any exercise to raise equity capital on the Singapore Exchange since its 2015 listing. It said it is unlikely to require access to the Singapore equity capital markets to finance its operations in the foreseeable future as it has various other available funding sources such as bank credit facilities.

Delisting will also allow SK Jewellery to save on expenses and costs relating to maintaining its listing status and channel such resources to its business operations, it said.

DBS is the sole financial adviser to OroGreen Investment.

The company on Tuesday requested to lift a trading halt called on Aug 28. Prior to the halt, the counter was trading up 8 per cent or 0.7 Singapore cent at 9.5 cents as at 4pm on Aug 28.