Osaka Electric Behinds SMB’s Mystery Bid
SMB United’s (SMB) mystery bidder was unveiled yesterday, as Osaka Electric (Osaka) revealed its $0.40 per share offer. Despite the late entrance, the Japanese manufacturer introduced a lucrative twist to the tussle as its offer is 25% more than that of the rival. Earlier in October, Hong Kong-listed Boer Power (Boer) tabled a hostile bid of $0.32 per share which was promptly rebuffed by the directors of SMB as ‘uncompelling’ and urged shareholders not to tender their shares. As at the trading halt yesterday, the last traded share price of SMB was $0.365 – already higher than the offer price of Boer. As at 19 December, Boer has only garnered valid acceptances amounting to 20.57%.
Significance: Including a cache of un-issued performance shares, Osaki’s bid would value SMB at up to $205 million while Boer’s would be around $164 million. Notably, shareholders representing 37.4% of the SMB’s current stock of issued shares have given irrevocable undertakings to accept Osaki’s offer.
Hafary To Gain $22.35m From Aljunied Property Sale
Hafary Holdings (Hafary) is likely to book a $22.35 million gain, arising from the sale of all units at its freehold Aljunied property. Specifically, the tiles and building materials supplier had entered into 59 sale and purchase agreements with 49 purchasers for all the units at a collective consideration of $65.28 million. The original plan for the 29,112 square feet plot of land was to develop it into a six-storey building, housing the group’s corporate headquarter and showroom space. However, in light of maintaining an acceptable gearing level and riding on high market demand, it decided to sell all the units.
Significance: The disposal gain will be recognised upon the completion of the industrial building. Not only does the sale allow Hafary to maintain an appropriate debt level, it would boost cashflow and position it to take on future business opportunities.
Independent Investigator Points To Breaches At FibreChem
FibreChem Technologies (FibreChem), the once market darling whose shares have been suspended from trading since early 2009, is deemed to have made financial and accounting irregularities. According to nTan Corporate Advisory, which was appointed to carry out an independent investigation, several financial discrepancies were unearthed ‘over an extended period of time’ since the company’s listing in 2004. It was noted that HK$777 million ($130 million) was found to be missing in cash, coupled with the omission of the China bank loans, these ‘are possibly attempts to artificially inflate the group’s cash balance and profitability’.
Significance: According to the Singapore Exchange, it ‘is closely monitoring the development of the investigation’ and ‘will review and take appropriate enforcement action against breaches of the listings rules’.