Investors would be better served if offer announcements had to reference book values

READERS of a late November announcement offering to privatise property player Chip Eng Seng might have been led to believe the offerors – billionaire couple Gordon and Celine Tang – were paying a reasonable market price for the stock.

Point eight of the offer announcement, which is a “financial evaluation of the offer”, says the consideration of S$0.72 per share represents an 80 per cent premium to the lowest closing price of Chip Eng Seng over the last three years.

The offer price is also 44.3 per cent above the volume-weighted average price (VWAP) of the shares in the last 24 months, 36.9 per cent above the VWAP for the last 12 months, and 28.3 per cent above the VWAP for the last six months.