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Fri, December 18, 2020-9: 14 am
A VEHICLE wholly owned by Hi-P International’s Chief Executive Officer (CEO) and majority shareholder, Yao Hsiao Tung, has made a voluntary and unconditional general offer for all of Hi-P International’s stock, which is listed on the main board, except the shares already owned by the offeror.
According to a stock exchange presentation on Friday morning, the offer price is Singapore $ 2 per share, and the offer is made with a view to removing the company from the Singapore Stock Exchange (SGX).
The offer price represents a premium of about 13.6 percent over the last traded price of S $ 1.76 on December 14, shares were traded on the last full market day and a 160.1 percent premium to Net asset value per share as of June 30, 2020.
The premium is also around 23.2, 42.3, 50.6 and 62.5 percent of the volume-weighted average price per share for the periods of one month, three months, six months and 12 months until last trading day included, respectively. .
“The offer price represents an opportunity for shareholders to make their entire investment in cash with a favorable valuation amid the prevailing economic uncertainty driven by the current Covid-19 pandemic and low trading liquidity of stocks,” said the offerer.
The offeror does not intend to revise the offering price of S $ 2 per share, but noted that it reserves the right to do so if a competitive situation arises.
As the offer is unconditional in all respects, the shareholders who accept the offer will receive payment of the offer price within seven business days after receipt of their valid acceptances by the offeror.
Yao, who is also president of Hi-P, is an existing majority shareholder of the company, holding about 83.4 percent of the total shares on the date of the offering. His wife, Wong Huey Fang, owns about 0.1 percent of Hi-P’s shares. They have provided irrevocable commitments to accept the offer.
The offer is made with a view to removing Hi-P from the list, and the offeror said that it intends to exercise its compulsory acquisition rights under the Corporation Law, if it has the right.
He said that the privatization of the company will give the bidder and management more flexibility to manage the company’s business and optimize the use of its management and capital resources, as well as facilitate the implementation of any operational changes. Exclusion from the listing will also allow the company to save on expenses related to maintaining its listing status.
The company has not conducted any corporate fundraising exercises at SGX since 2004, he added. “The bidder is of the view that the company is unlikely to require access to Singapore’s capital markets to finance its operations in the foreseeable future.”
In response to the offer, Hi-P’s board of directors said separately on Friday that it will appoint an independent financial advisor (IFA) to advise directors of the company who are deemed independent for the purposes of the offer. The appointment will be announced in due course.
The company will issue a circular to shareholders with the advice of the IFA and the recommendation of the independent directors within 14 days of sending the offer document.
CLSA Singapore and DBS Bank are the joint financial advisers of the offeror.
Hi-P shares last traded at Singapore $ 1.81 on December 15, before a trade suspension was called. The trade suspension was lifted on Friday morning.
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