SINGAPORE – Chip Eng Seng chairman Celine Tang and her husband Gordon Tang have made a voluntary conditional cash offer to acquire all the issued ordinary shares in the property firm at 72 cents apiece, with the end goal of taking the company private should they attain more than 90 per cent of shares.
The offeror is Tang Dynasty Treasure – an investment holding company owned by the Tang couple, who also recently privatised SingHaiyi Group at a significant discount to its net asset value. SingHaiyi was delisted from the Singapore Exchange on Jan 31.
In an announcement on Thursday night, Chip Eng Seng said the offer price represents a year-to-date return of some 80.5 per cent, and a premium of about 36.9 per cent over the volume-weighted average price (VWAP) of the company’s shares for the 12-month period prior to and including the holding announcement date of Sept 7.
The premiums of the consideration over the VWAP for the one-month, three-month and six-month periods are 8.6 per cent, 21.4 per cent and 28.3 per cent respectively, it said.
However, the offer translates to a discount of 27.3 per cent when compared with Chip Eng Seng’s group net asset value of 99 cents as at June 30.
The Tang couple jointly own just shy of 290.7 million shares of Chip Eng Seng. Mr Tang also personally owns 9.1 million shares. This means the duo hold about 38.23 per cent of the company’s shares.
Senz Holdings – a company owned by Mr Tang’s mother, Madam Yang Chanzhen, and the Tang couple’s son Tang Jialin – holds a 3.22 per cent stake in Chip Eng Seng.
Chip Eng Seng said the offer allows shareholders to realise their investments “at a premium without incurring brokerage fees”.
The offeror also said the move will “strengthen competitiveness and optimise resources”. It noted that SingHaiyi and Chip Eng Seng had entered into “numerous joint ventures” to leverage the collective experience and expertise to deliver superior products to consumers.
“Due to rising interest and inflation rates, the ongoing Covid-19 pandemic and geopolitical tensions ensuing from the ongoing Russia-Ukraine conflict, property developers in Singapore are operating in a challenging environment,” the offer documents said.
“On the back of the macro headwinds, the offeror believes that this offer will provide the offeror with greater control to manage the overall business, optimise and streamline the resources to improve operational efficiency and effectiveness.”
The offeror has appointed UOB as its sole financial adviser.
Shares of Chip Eng Seng traded down one cent, or 1.4 per cent, at 71.5 cents in heavy volume early on Friday, before the company called for a trading halt at 9.21 am. THE BUSINESS TIMES