SINGAPORE - Thousands of SMRT Corp shareholders who turned up to attend a shareholders' meeting on Thursday (Sept 29) to vote on one of Singapore's most closely watched privatisation proposals of recent years were left frustrated after a longer-than-expected meeting.
There was also a computer glitch in the electronic voting system. At around 4.15 pm, when voting was due to commence, activist shareholder Mano Sabnani stood up to protest that some of the devices failed to register a "No" vote on the scoreboard while they were being tested.
He demanded an explanation, saying that the system appeared to accept only a "Yes" vote.
Chairman Koh Yong Guan asked for shareholders' patience as officials tried to pinpoint the issue.
As at 4.30pm, the issue remained unresolved and some shareholders started to leave. An announcement was subsequently made that the voting would restart soon.
Around 4,000 shareholders had gathered at Star Theatre - with a capacity of 5,000 - for the meeting at 2.30pm, Thursday. It is part of The Star Performing Arts Centre.
First, shareholders voted to decide whether to approve the sale of SMRT's train and other rail assets to the Government as part of the New Rail Financing Framework deal struck in July.
This is followed by a scheme meeting, in which they will decide whether to accept Temasek Holdings' buyout offer of $1.68 per share.
The takeover offer is structured as a scheme of arrangement.
For its bid to succeed, Temasek needs more than 50 per cent of shareholders present in person or by proxy to vote "yes". These shareholders will also have to hold at least 75 per cent of the value of total shares held by all at the meeting.
Temasek, a 54 per cent shareholder of SMRT, will abstain from voting.
One shareholder, Mr Yap, said he would accept the offer as the offer price is higher than what he paid in the early 2000s.
"But my concern is this: will SMRT actually be able to improve its services as a private company, with less scrutiny? That's not a given. It's my belief that a public service company like SMRT should remain a public listed company," he said.
Another shareholder attending the meeting, Mr Fong said: "I'm undecided and ready to hear what (SMRT) has to say later, even though honestly I don't find $1.68 a fair offer. But this may be the only chance to cash out."
Another shareholder, a Mr Tan, was more positive: "I bought last year and selling at $1.68 will make me money, so I'm for the deal. I also think SMRT needs this deal to go private so that it can really fix the MRT breakdowns. The service is in a shambles and it won't be able to do much staying listed."
Shareholders have been debating whether $1.68 per share is fair value, pointing at the 5 per cent Ebit (earnings before interest and taxes) margin cap on rail business - a mechanism attached to the NRFF deal - as a reason that the offer may have undervalued SMRT.