The directors of mainboard-listed Chemoil Energy proposed a voluntary delisting of the marine oil supplier on Tuesday.
Singfuel Investment, an indirect subsidiary of Glencore Xstrata, has made a cash exit offer of 40 US cents (50.6 cents) apiece to acquire the ordinary shares held by existing Chemoil shareholders.
It will also be extended to buy back new shares issued from a 2006 share option scheme that are made before the close of the exit offer.
Singfuel Investment's offer is a 29 per cent premium from its last full trading price on Feb 20 at 31 US cents. Chemoil had called for a trading halt the next day, pending an announcement.
Using the volume weighted average price calculations for the one-, three- and six-month periods preceding the Feb 21 trading halt, the exit offer comes at a 31 per cent to 32 per cent premium.
Chemoil said that the delisting offer is conditional upon several issues including the Singapore Exchange's approval and the delisting resolution being passed at an extraordinary general meeting.
As of Tuesday, Singfuel and parties acting in concert with it hold 1.15 billion shares, or about 89.2 per cent of the total issued share capital of Chemoil.
"The offeror intends to vote all of the 1.15 billion shares held by it in favour of the delisting resolution at the extraordinary general meeting," said the company in a statement.
Reasons cited for the voluntary listing include a low free float and trading liquidity of the shares. Shareholders were told that the exit offer allows them "to realise the value of their investments for cash at a premium over the historical traded prices...without incurring brokerage or other trading costs".