The value of Tang Plaza in Orchard Road was again the bone of contention between die-hard minority shareholders and the CK Tang board at the firm's annual general meeting (AGM) yesterday.
Shareholders believe the property - part owned by CK Tang - is a goldmine, given its prime location.
Questions over its valuation dominated much of the nearly three-hour AGM at the RELC Building, next to Shangri-La Hotel.
CK Tang was delisted in 2009 but some 500 shareholders retain under 2 per cent of its shares, hoping for a better cash-out price.
The fair value of the part of the property home to the flagship Tangs store was $476 million as at March 31, CK Tang's financial statements said.
But many of the 35 minority shareholders at the meeting felt it could be higher if the redevelopment potential of the asset were taken into account. The property is being valued on its "existing use".
"That may not be the best or maximum value of the property. They should consider what is the best mix that could get the maximum value if it is redeveloped into commercial or hotel or mixed-use," an investor, Mr Lim, told The Straits Times after the meeting.
The concern was that an undervalued property would weigh on the value of their shares, especially in the light of a recent general offer for all the shares of CK Tang.
On using other valuation methods, deputy chairman and non-executive director Soh Yew Hock said: "That is not relevant because it is meant for existing use and not a hypothetical situation." CK Tang intends to keep the retail business.
This argument over property value is not new. It formed the crux of complaints in 2009, when CK Tang launched its third - and successful - bid to delist.
Mr Soh chaired the AGM in the absence of chairman Tang Wee Sung. It was also announced yesterday that Mr Tang and two other directors, Mr Foo Tiang Sooi and Mr Michel Grunberg, are retiring from the board with effect from today.
In May, brothers Tang Wee Sung, and Tang Wee Kit sold their majority stake to Tang Holdings for 34.967 cents apiece, sparking a general offer for the rest of the shares.
Minority shareholders were offered 35 cents a share, which independent financial adviser CIMB Bank said in a June 7 report was "not fair and not reasonable". The investors were advised to reject the offer.
When the offer closed on June 22, Tang Holdings received acceptance of 299,500 shares - about 0.13 per cent of the total shares. The investment holding firm now owns 98.27 per cent of CK Tang.
The Straits Times understands the rest are held by around 460 minority shareholders, who spurned earlier chances to offload them.
Tang Holdings, a private firm, is controlled by the Tang brothers.