KUALA LUMPUR: TEXCHEM RESOURCES BHD [] has scrapped its plan to privatise and delist its 70.48%-owned subsidiary Texchem-Pack (S) Ltd from the Singapore Exchange (SGX).
This decision comes after the Singapore Exchange Securities Trading Ltd's (SGX-ST) independent financial adviser Partners Capital (Singapore) Pte Ltd, had opined that the financial terms of the exit offer were unreasonable.
The proposal it seems had not met the requirements of rule 1309(1) of SGX-ST's listing manual which required a "reasonable exit alternative be offered to shareholders and holders of any other classes of listed securities to be delisted".
Texchem had offered to acquire all the remaining shares representing a 29.52% stake in Texchem-Pack for an aggregate cash consideration of about S$5.5 million (RM13.4 million), or 13.5 cents apiece.
The offer price was based on its historical share price performance, and represented a 42.1% premium from the closing market price of 9.5 sen on Feb 5, which was the last day of trading prior to its exit offer announcement.
The company said it had planned to delist its subsidiary, as it did not see the necessity for Texchem-Pack to access Singapore's capital markets to raise money. Moreover the extra cost of maintaining separate listings for both companies, and a lack of its subsidiary's market liquidity in the SGX, were contributing factors.
Texchem ended trading on Tuesday, June 15 at 84 sen, inching up half a sen.
This decision comes after the Singapore Exchange Securities Trading Ltd's (SGX-ST) independent financial adviser Partners Capital (Singapore) Pte Ltd, had opined that the financial terms of the exit offer were unreasonable.
The proposal it seems had not met the requirements of rule 1309(1) of SGX-ST's listing manual which required a "reasonable exit alternative be offered to shareholders and holders of any other classes of listed securities to be delisted".
Texchem had offered to acquire all the remaining shares representing a 29.52% stake in Texchem-Pack for an aggregate cash consideration of about S$5.5 million (RM13.4 million), or 13.5 cents apiece.
The offer price was based on its historical share price performance, and represented a 42.1% premium from the closing market price of 9.5 sen on Feb 5, which was the last day of trading prior to its exit offer announcement.
The company said it had planned to delist its subsidiary, as it did not see the necessity for Texchem-Pack to access Singapore's capital markets to raise money. Moreover the extra cost of maintaining separate listings for both companies, and a lack of its subsidiary's market liquidity in the SGX, were contributing factors.
Texchem ended trading on Tuesday, June 15 at 84 sen, inching up half a sen.
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