SINGAPORE - Mainboard-listed Falcon Energy Group is mounting a takeover offer of CH Offshore.
The company, which is in the offshore marine, and oil and gas sectors is offering 49.5 cents apiece for all the shares of CH Offshore it does not already own.
Falcon currently owns 29.9 per cent of CH Offshore, which operates a fleet of 15 anchor handling tug supply vessels and has a track record of over 30 years in providing marine support services to the oil and gas industry.
In a statement through financial adviser CIMB Bank, Falcon said the offer represents the highest traded price of the CH Offshore in the past one year.
It represents a 6.45 per cent and 8.32 per cent premium over the last closing price before the announcement and the one-month volume weighted average price, respectively.
The maximum consideration payable by Falcon is some $247.5 million and will be funded by internal cash resources and bank borrowings.
The offer is conditional on Falcon owning more than 50 per cent of CH Offshore shares.
Net Asset Value of CHO Shares
Based on the financial statements for the year ended June 30, the net asset value per share of CH Offshore is about 34.04 US cents. As at the first quarter ended Sept 30, this has risen to about 34.82 US cents.
"We have previously stated that we plan to acquire more vessels to broaden the number of vessel types and to cater to a broader group of customers," said Falcon chairman and chief executive Tan Pong Tyea.
Taking a controlling interest in CH Offshore, which has a complementary business, is in line with the strategy, added Mr Tan, who is also non-executive chairman of CH Offshore.
Falcon's marine division has embarked on a fleet expansion programme to include different vessel types with different technical specifications and workload capabilities to fulfil its customers' requirements.
Following a strategic review, Falcon believes that by increasing its control of CH Offshore, it will be able to explore opportunities to unlock synergies in the the latter's businesses.
Falcon intends to maintain the listing CH Offshore following the completion of the offer.
However, should the percentage of CH Offshore shares held in public hands falls below 10 per cent, Falcon may exercise its right of compulsory acquisition for the remaining shares it does not own.