Sinjia Land enters S$2B reverse take-over deal with BINEX Singapore

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Sinjia Land has entered a non-binding term sheet to acquire all of BINEX Singapore (BSG) from Japan-based BINEX (BJN) for at least S$2 billion in a reverse takeover, the company said in a filing to SGX Friday.

BSG is involved in cultivating sorghum and producing biomethanol from it and licenses bio-pellets from sorghum, and in buying and selling carbon credits from sorghum’s carbon dioxide-absorption.

The deal will be financed via the issuance of new Sinjia Land shares at S$0.35 each, a premium of around 108 percent of the S$0.168 closing price on Friday, the filing said, noting that would make BJN the largest shareholder.

The indicative consideration would result in 5.17 billion new shares being issued, or an around 96.99 percent stake of the enlarged share capital, Sinjia Land said.

The purchase consideration will be 80 percent of the valuation of BSG by an independent valuer, but the consideration won’t be less than S$2 billion, the filing said.

“To enhance shareholder value, the company has been seeking an appropriate business to be injected into the group. The company is of the view that the proposed acquisition will place the company in a position to expand into new business areas and grow revenues,” Sinjia Land said in the statement.

BSG is 76.19 percent-owned by BJN, with the other shareholders including 3DOM with 9.52 percent, Biomass Energy with 4.76 percent, Mebius with 4.76 percent and Future Science Research with 4.76 percent, the filing said.

BJN, which was established this year to address food, environmental and energy issues, and to build a value chain for biomethanol, is 60 percent-owned by 3DOM, while Biomass Energy hold 30 percent, Mebius holds 5 percent, and Future Science Research holds 5 percent, the filing said.

The deal is subject to due diligence, shareholder approval and other conditions, the filing said.

The proposed completion date for the deal is 31 July 2022, the filing said.

On Friday, Sinjia Land’s shares surged 57 percent in high volume to close at S$0.168, prompting a query from SGX.

In response, the company said that other than the BINEX Singapore (BSG) announcement, which was made after Friday’s close, it was unaware of any other reason for the share price moves.

Japan-based 3DOM develops technology for carbon dioxide-free mobility and develops sustainable business models; it develops next-generation batteries in Yokohama.