Raffles United receives takeover bid from Raffles Infinity Holdings

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Raffles Infinity Holdings, a special purpose vehicle, plans to make a mandatory unconditional cash offer for all of Raffles United’s shares at S$0.065 each, the offerer said in a filing to SGX Monday.

The offer price is a 27 percent premium over the stock’s last traded price of S$0.051 on Thursday, the filing said.

“In view of the company being on the watch-list, it is very unlikely that the company can find new investors, or improve its currently illiquid and thinly traded shares, in order to exit the watch-list,” Raffles Infinity said in the filing.

“Shareholders who are not prepared to bear the risks associated with the company being placed on the watch-list (which may subsequently result in the SGX-ST delisting the company or suspending trading in the company’s shares with a view to delisting the company), will benefit from the cash exit,” it added.

On Monday, Raffles Infinity acquired a total 324.32 million Raffles United shares, or an 82.08 percent stake, from Raffles United Pte. Ltd. (RUPL) and Teo Xian-Hui Amanda Marie (TXH) at S$0.055 each, the filing said.

TXH, who is the daughter of Teo Teng Beng, Raffles United’s managing director, still holds a 4.09 percent direct stake in Raffles United and she intends to accept the takeover offer, the filing said.

That put Raffles Infinity and its concert parties in control of around 86.17 percent of Raffles United, and triggered a mandatory general offer under the take-overs and mergers code, the filing said.

If the offer results in control of more than 90 percent of Raffles United, Raffles Infinity intends to compulsorily acquire the remaining shares and delist the company, the filing said. That would be a move to save on the expenses of maintaining a listed status and to focus resources on the business operations instead, the filing said.

Raffles Infinity is a special purpose vehicle incorporated to make the offer, and it has TXH as its sole shareholder, the filing said.

Raffles United is mainly involved in the distribution and selling of bearings and seals in Southeast Asia and the Far East, property investment and property development, the filing said. The company also offers gearbox and electrical projects to distributors, retailers and contractors and sells beauty products to consumers, the filing said.

In a separate filing to SGX Monday, Raffles United said it would appoint an independent financial adviser and would publish a circular with the advice and recommendations.

“In the meantime, shareholders are advised to exercise caution when dealing with their shares,” Raffles United said.

Raffles United requested the trading halt on its shares be lifted Tuesday.

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