SINGAPORE - The independent financial adviser (IFA) has issued an opinion finding that the offer by the Riady family to buy out Auric Pacific Group for S$1.65 a share to be fair and reasonable.

The IFA, in a report Tuesday morning, recommended that the shareholders either accept the offer or sell their shares in the open market if they can obtain a price higher than the offer price after deducting transaction and related expenses.

The offer to take the group private was made on Feb 7 by Silver Creek Capital, an investment vehicle jointly owned by Mr Stephen Riady and his son-in-law Andy Adhiwana, who are controlling shareholders of Auric Pacific, the maker of Sunshine bread and owner of Food Junction foodcourts and Delifrance cafes.

Mr Riady holds 49.28 per cent of Auric Pacific, indirectly through Hong Kong-listed Lippo China Resources; Dr Adhiwana holds, indirectly through Goldstream, 27.44 per cent. Since the offer, Silver Creek has acquired a 4.01 per cent stake. Together, all three hold 80.73 per cent in the group.

In coming to its decision, the IFA said it has considered factors including the historical market price and trading activity of Auric shares; the group's historical performance; its asset-based valuation; valuation statistics of selected companies comparable to the group; a comparison with the successful privatisation/delisting of companies and the company's dividend track record.

Once Auric is delisted from the Singapore Exchange, shareholders who have not accepted the offer may face difficulties selling their shares in the absence of a public market for the shares, the IFA warned.