Another exit offer for Boustead Projects

Boustead Singapore said the exit offer was made at the earliest practicable time after the expiry of its moratorium on Sept 27. — The Straits Times

SINGAPORE: Boustead Singapore has proposed an unconditional cash exit offer for its real estate unit Boustead Projects at S$1.18 per share.

This is 23.6% higher than Boustead Projects’ last-traded price of 95.5 Singapore cents prior to its trading suspension. It also represents a 24.2% increase from its previous voluntary unconditional general offer of 95 Singapore cents per share, which closed at 5.30pm on March 27.

The exit offer price stands at 20 times Boustead Projects’ consolidated earnings per share and 0.9 times its net asset value per share for its last financial year.

On Tuesday, Boustead Singapore said the exit offer was made at the earliest practicable time after the expiry of its moratorium on Sept 27.

This was because it was necessary for both the group and Boustead Projects’ interim results and financial positions to be considered by their respective independent financial advisers.

Boustead Singapore added that its independent directors “spent considerable time and effort during the moratorium period to weigh all possible delisting and privatisation options to achieve a positive outcome for all stakeholders”.

“They have a fiduciary duty to protect the interests of Boustead Singapore’s minority shareholders and had to ensure that any subsequent offer would be attractive to Boustead Projects’ public minority shareholders, and yet not be prejudicial to the interests of Boustead Singapore and its minority shareholders.”

Boustead Singapore will hold an EGM before the end of 2023 to seek approval from its independent minority shareholders in acquiring Boustead Projects shares belonging to Boustead Singapore’s chairman and group chief executive Wong Fong Fui and his children.

Wong and his children – who collectively hold a 19.99% stake as at the close of the previous offer – have abstained from decision-making on both the previous offer and Boustead Singapore’s current exit offer due to material conflicts of interest.

Shareholdings of Boustead Singapore in Boustead Projects stood at 75.5% as at the close of the previous offer.

The remaining 4.51% equity in Boustead Projects was held by public shareholders who did not accept the previous offer.

As Boustead Projects did not meet the Singapore Exchange’s free float requirement of at least 10%, the counter was suspended from trading effective from 9am on March 28, 2023.

Boustead Singapore was not allowed to make a better offer for Boustead Projects for six months following the close of the previous offer.

This is although Boustead Projects sought for two three-month extensions from the Singapore Exchange to comply with the listing rules.

Shares of Boustead Singapore ended 1.5 cents, or 1.8%, higher at 85 Singapore cents on Tuesday, after news of its exit offer as well as the release of its first-half results. — The Straits Times/ANN