Yet another mainboard-listed company looks set to join the delisting bandwagon. The Riady family has offered to buy out Auric Pacific Group, the maker of Sunshine Bread and owner of Food Junction foodcourts and Delifrance cafes, and take it private.
The offer was made by Silver Creek Capital, an investment vehicle jointly owned by Dr Stephen Riady and his son-in-law Andy Adhiwana, who are controlling shareholders of Auric Pacific. Their offer of $1.65 in cash for each share is final, according to a filing on the Singapore Exchange yesterday.
Shares of Auric Pacific jumped 13.4 per cent or 19.5 cents to the offer level - $1.65 - after the counter resumed trading following a two-hour trading halt. More than 2.4 million shares changed hands.
Separately, several companies belonging to the Lippo Group, which is controlled by the Riady family, made an offer to lift their stake in Healthway Medical Corporation.
Dr Riady and his family indirectly hold 49.28 per cent of Auric Pacific through Hong Kong-listed Lippo China Resources, while Dr Adhiwana, Auric's group chief executive, holds 27.44 per cent indirectly through Goldstream Capital.
Silver Creek said the offer is "an opportunity to realise their investment in the company for a cash consideration at a significant premium" above the historical market share prices, without incurring any brokerage and other trading costs.
The offer price is a premium of about 13.4 per cent over the closing price on Feb 3, its last traded day before the offer announcement.
One reason cited for the proposed delisting is the "cost savings" from dispensing with "compliance and associated costs" in maintaining Auric Pacific's listing status.
Mr Justin Tang, director of global special situations at Religare Capital Markets, said Auric Pacific may see compliance costs as an expense it is no longer willing to bear, given that it is "already in a steady phase of its business life cycle".
"Mr Riady is rumoured to be interested in United Engineers, and may want full control of Auric Pacific to conduct asset restructuring on the backend," he said.
Other prominent stocks that went private last year included Tiger Airways, Osim International, Eu Yan Sang and Sim Lian Group.
Auric Pacific said it is exploring a possible impairment of intangible assets arising from the acquisition of the Food Junction business and certain leasehold improvement and equipment in its Delifrance factory in its 2016 full-year results. For the nine months to Sept 30, 2016, Auric Pacific posted $7.6 million in net profit on revenue of $317.6 million. The group net assets attributable to shareholders stood at $168 million.
