Shares of Chip Eng Seng dropped 6.35 percent at S$0.885 by 11:46 A.M. SGT despite the construction and property group saying on Friday that a nearly 30 percent stake in the company changed hands at S$1.08 a share.
A trader told Shenton Wire via email on Monday that the selloff was due to disappointment that the stake size was less than 30 percent.
The purchase of a 30 percent stake would trigger a mandatory takeover bid.
The trader said that speculation of a potential bid for the company had emerged after the stock spiked higher on 1 October. On that day, the stock had spiked up as high as S$0.91 on high volume from S$0.835 at the previous session’s close.
In a filing to SGX on Friday, Chip Eng Seng said it received notification from seven shareholders that they entered a deal with Celine Tang to sell an around 29.73 percent stake in the company, or around 186.11 million shares.
Shenton Wire has asked SingHaiyi Group via email on Friday to confirm if its managing director, Celine Tang, was the purchaser of the Chip Eng Seng shares and if the purchase was for the company. SingHaiyi didn’t immediately respond to the email, which was sent outside of business hours.