SINGAPORE - Lifestyle real estate developer Top Global is seeking a delisting from the Singapore Exchange to escape looming Qualifying Certificate (QC) penalties for unsold homes it will have to pay a year from now.
Executive chairman Oei Siu Hoa, also known as Sukmawati Widjaja, on Tuesday launched a cash offer to buy out minority shareholders for 33 Singapore cents (Scents) a share.
The offer represents a 50 per cent premium to the last traded price of 22 Scents last Friday. Trading of Top Global shares had been halted from Monday, pending an announcement.
Madam Oei, who is the younger sister of tycoon Oei Hong Leong and a member of the family behind Indonesia's conglomerate Sinar Mas group, bought a majority stake in Top Global in 2010. She held a 77.4 per cent stake as of Tuesday.
The offer is conditional upon her receiving acceptances amounting to at least 90 per cent of issued shares by the offer close.
The offer statement flagged that unless Top Global is privatised, two of its residential projects, R Maison and E Maison in Braddell, will be subject to QC penalties after March next year.
At present, about 20 per cent of the 45-unit R Maison remains unsold, while 40 per cent of the 130-unit E Maison remains unsold.
Under the QC requirement intended to reduce speculation in Singapore's property market, a penalty will be incurred on property units developed by foreign companies that remain unsold two years after completion.
All listed firms are technically considered foreign since they have non-Singaporean shareholders.
Popular Holdings delisted in 2015 and SC Global delisted in 2013 to avoid QC charges.
Another Top Global Project, The Quinn at Bartley Road, will be subject to QC rules by June 2018.
Although QC penalties will be avoided since the company said on Tuesday that four of its subsidiaries had exercised options to purchase 17 units for S$25.3 million, Madam Oei's offer vehicle said it would be "challenging" for Top Global to avoid making further losses when its subsidiaries sell the Quinn units over the next three years as any such sale will still be subject to applicable Seller's Stamp Duty.