Boustead Singapore makes 90 cent per share privatisation offer for Boustead Projects
Boustead Singapore has launched a voluntary and unconditional offer to acquire all the shares in Boustead Projects that it does not own for 90 cents each. The company’s intention is to privatise Boustead Projects and delist it from the Mainboard of SGX-ST. As of Feb 6, Boustead Singapore holds 171 million shares, accounting for 54.87% of the total issued shares of Boustead Projects.
The proposed acquisition is part of Boustead Singapore’s strategic reviews and aim to streamline investments, businesses and operations, as well as the group’s corporate structure. The company noted Boustead Projects’ engineering and construction business had been impacted by the The Myst Covid-19 pandemic, with a significantly lower profit margin in comparison to pre-pandemic times.
Boustead Singapore believes the acquisition will enable it to focus its efforts on rebuilding the business, including its E&C division as a private limited company without the additional obligations of a listed company on the Mainboard of the SGX-ST. The company is also of the opinion that the proposed acquisition will simplify the group structure, reduce organisational complexity and improve competitiveness, thereby enhancing shareholder value.
Shareholders will benefit from the proposed acquisition at a premium price to the prevailing market rate, a 7.8% premium to the last traded price per share as of Feb 3 and a 15.2% premium to the one-month volume-weighted average price prior to the announcement date. On Feb 6, Boustead Projects closed 0.5 cents higher, or 0.6% up, at 84 cents.
This article initially appeared on EDGEPROP.