Offer for Sunrise Shares goes unconditional, closing date extended

SINGAPORE - The offer for electrical products trader and distributer Sunrise Shares has been made unconditional, while the closing date has been extended to Feb 7.

In December, Hong Kong-based businessman Wong Siu Fai acquired a 90 per cent stake in Quality Able, which holds a 4.49 per cent stake in Sunrise Shares, for $122,400. Including his direct and deemed stake of 29.73 per cent at the time, this pushed his total stake past the 30 per cent threshold, triggering the requirement for a general offer for the rest of the company's shares. He has made an offer of $0.017 per share.

As at 16 Jan, the total number of shares owned, controlled or agreed to be acquired by Mr Wong and his concert group; and valid acceptances to the offer, amount to some 95.88 million shares, representing approximately 53.8 per cent of the company, Sunrise Shares said in an exchange filing on Thursday.

Last week, the independent financial advisers (IFA) of Sunrise Shares said the offer is "not fair and not reasonable", according to a circular sent to shareholders of the firm. The directors concurred with the advice of the IFA Novus Corporate Finance regarding the offer, and have recommended that shareholders reject it.

A letter by the IFA noted that trading in the shares had been sporadic in the year leading up to the offer announcement. Due to the lack of trading liquidity of the shares, the closing prices of the shares may not necessarily be a meaningful indicator of the fundamental value, the letter said.

The offer price represents a significant discount of 64.4 per cent to the volume-weighted average price (VWAP) for the one-year period prior to the offer announcement, but represents a premium of approximately 21.4 per cent over the closing price of the shares of $0.014 on their last trading day.

Formerly ITE Electric, Sunrise Shares was one of those caught up in 2013's penny stock saga. After being called up for investigations, ITE's then chief executive Ho Cheng Leong sold his stake to the firm's former non-executive chairman, who later also divested his entire stake for $6 million to Mr Wong in 2016.