Fragrance joins SGX delistings; Singapore's TDCX heads for NY listing

PROPERTY developer Fragrance Group F31 : F31 0% has applied to delist from the Singapore Stock Exchange, even as Singapore-headquartered TDCX, which provides digital customer experience (CX) services, heads for a listing in New York.

Mainboard-listed Fragrance announced on Wednesday that it has applied to the exchange for a delisting following a privatisation offer. (see amendment note)

In early July, Fragrance Group's founder and chief executive Koh Wee Meng, through offeror JK Global Treasures, made a voluntary conditional cash offer for all the issued and paid-up ordinary shares of the group at 13.8 Singapore cents per share to take the company private.

The offer price of 13.8 Singapore cents per share exceeded Fragrance's last traded price on July 8  of 11.8 cents, representing a 16.9 per cent premium. It also represents a premium of 19 per cent, 19 per cent, 20 per cent and 21.1 per cent respectively over the one-month, three-month, six-month and 12-month volume-weighted average price per share.

The offeror intended to privatise the company, as it expects Fragrance not needing to access the Singapore equity capital markets to finance its operations in the foreseeable future.

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Fragrance Group's shares closed flat at 13.7 Singapore cents on Wednesday.

Meanwhile TDCX has filed for an initial public offering (IPO) on the New York Stock Exchange (NYSE).NYSE, with an offering of American depositary shares.

The amount to be raised was not disclosed.

Founded in 1995 by chief executive Laurent Junique, TDCX provides business-process services such as omnichannel CX solutions, sales and digital marketing services and content monitoring and moderation services. It has operations in 10 markets around the world and a workforce of more than 13,000.

In its prospectus, the company said that it partners clients in fast-growing new-economy sectors and traditional blue-chip companies undergoing digital transformation. In particular, Facebook and Airbnb account for the largest share of its revenue pie - at 60 per cent in 2020.

The bulk of its revenue (65 per cent) comes from its omnichannel CX solutions.

From the year ended Dec 31, 2018 to the year ended Dec 31, 2020, TDCX's revenue, profit for the year, and Ebitda (earnings before interest, taxes, depreciation and amortisation) grew at a CAGR (compound annual growth rate) of 54.9 per cent, 50.3 per cent and 60.7 per cent, respectively.

For 2018, 2019 and 2020, revenue stood at S$181.2 million, S$330.3 million and S$434.7 million respectively. The company recorded profit of S$38.1 million, S$73.5 million and S$86.1 million respectively, and Ebitda of S$55.4 million, S$108.1 million and S$142.9 million respectively.

Its net profit margin stood at 21 per cent, 22.2 per cent and 19.8 per cent for 2018, 2019 and 2020.

The company said that it intends to use a portion of the proceeds from its offering to repay the total outstanding principal amount of US$188 million under its Credit Suisse facility, which represents a significant portion of its debt that is outstanding.

The remainder will be used to expand its business into new markets, which would include costs for premises, technology and systems and other infrastructure, as well as for hiring of personnel and other expansion-related expenses, and for general corporate purposes, including working-capital needs and potential acquisitions, said the prospectus.

The company has identified Korea and other Chinese regional markets - where it does not currently operate - as potential new markets for entry.

TDCX was the top winner at the Enterprise 50 Awards 2019, an annual award co-organised by The Business Times and KPMG.

READ MORE:

• Singapore stocks: Once bitten, twice shy

• Pan Ocean proposes delisting from SGX with S$8.70 per share exit offer price

• Catalist-listed M Development to delist from SGX on July 16

• Stratech unable to provide exit offer, to be delisted on Oct 23

Amendment note: The article has been amended to reflect that Fragrance Group is listed on the SGX mainboard instead of the Catalist.