SINGAPORE - Tee International has entered into a term sheet with Top Capital Securities Pte Ltd (Top Capital) for the proposed sale of a 28 per cent stake in its listed subsidiary, Tee Land, at an indicative price of between $0.179 and $0.201 per share, for up to 125.1 million shares, the group said in a regulatory filing on Monday (Feb 25).
The indicative price is based on an attributed net asset value of between $80 million and $90 million for Tee Land, representing respectively a 39.2 per cent and 46 per cent discount to its unaudited net asset value as at Nov 30, 2018.
The proposed sale is conditional on the execution of a definitive sale and purchase agreement, as well as satisfactory due diligence, the group added. It is targeted to be completed no later than April 30, 2019.
In connection with the proposed transaction, Tee International has granted an exclusivity period of two calendar months to Top Capital. Meanwhile, a refundable deposit from Top Capital is payable to Tee International within seven business days of the execution of the term sheet.
The term sheet is generally non-binding, and is intended to provide the basis for preparation of transaction documentation. This helps to set forth the basic terms and conditions under which an investment will be made. Once both parties have agreed on the details to be laid out in the term sheet, a binding agreement can then be drawn up.
Last month, Tee International disclosed that it had been approached by various interested parties with proposals for Tee Land's business and assets. It had announced last December after its strategic review to "evaluate opportunities and positioning" for the unit.
Following Monday's announcement, Tee International has requested to lift a trading halt it had asked for on Feb 22.