SINGAPORE (THE BUSINESS TIMES) - Technology incubator DeClout has made a mandatory cash offer for IT solutions provider Procurri Corp after it purchased 3.9 million shares in the company through a married deal and triggered a need for a compliance offer.
The offer price of 42.5 cents per share in cash is final, and DeClout will not increase the price further, it said on Friday (May 20).
DeClout, which originally owned a 29.4 per cent stake in Procurri, raised its stakes to 30.8 per cent after the married deal, resulting in the need for a compliance offer for all shares of Procurri that it does not already own.
Under Singapore's takeover code, any entity must make a mandatory general offer when it acquires 30 per cent or more of the voting rights of a company.
DeClout, however, said it intends to maintain the listing status of Procurri following the offer and does not currently intend to exercise any rights of compulsory acquisition.
DeClout on Friday made a married deal for 1.3 per cent of Procurri's shares at 42.5 cents each.
On Wednesday, it also acquired 9 million Procurri shares at the same price, for a total of $3.83 million.
The offer price is the same as Procurri's last transacted price on Thursday, being the last full trading date of the company prior to the offer announcement.
It also represents a 3.2 per cent premium to Procurri's volume-weighted average price (VWAP) for the 1-month prior to the last trading day, and a premium of 20.4 per cent to the VWAP for the 12-month period.
In 2021, private equity firm Novo Tellus made a partial offer for 27.9 per cent of Procurri's shares at 36.5 cents apiece, noting that Procurri requires "significant strategic investment to grow long-term share value".
However, the plan fell through after Novo Tellus received valid acceptances that brought its shareholding to just 37.37 per cent.
It also failed to receive 50 per cent of independent shareholder votes in favour of the offer.
After the offer was made, DeClout and two other substantial shareholders, which then held a combined 34 per cent stake in Procurri, had said they would vote against the offer.
Then, DeClout chairman and group chief executive Vesmond Wong told The Business Times that "these shareholders have been with us for a long time, so I guess they understand the value of Procurri".
He said he would also prefer a full offer to a partial offer, as he hopes to work with Novo Tellus and Procurri's management team to improve the company's performance.
Shares of Procurri were trading flat at 42.5 cents on Friday, before it called for a trading halt in the afternoon.