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GEAR’s board raises takeover offer to 18.1 cents per share; all-cash consideration offer upped to 97.3 cents

Felicia Tan
·2-min read

The offer was revised after several factors, such as GEAR's financial performance for the FY2022, were considered.

The board of Golden Energy and Resources (GEAR) AUE has increased its offer price for the remaining shares it does not own in the company on March 18.

The all-cash consideration has now been raised to 97.3 cents per share, 15% higher than its previous offer of 84.6 cents per share.

The cash alternative price has also been increased to IDR6,500 (56.7 cents) per GEMS share. GEMS stands for PT Golden Energy Mines, GEAR’s Indonesia-listed company. In its bourse filing, GEAR stated that entitled shareholders can opt to receive 1.3936 GEMS shares or a cash consideration of 79.2 cents (being the revised GEMS cash consideration). The amount is based on the distribution ratio, the revised cash alternative price and the agreed exchange rate of IDR6,500 multiplied by 1.3936, divided by the agreed exchange rate and rounded up to three decimal places.

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Finally, the exit offer price was also increased to 18.1 cents per offer share from 16 cents previously.

According to GEAR’s board, the offer was revised after it took several factors such as the company’s financial performance for the FY2022 ended Dec 31, 2022 and its business outlook into account. The financial resources available to the company, the offer and its majority shareholder, PT Dian Swastatika Sentosa Tbk (DSS) to implement the proposed transactions, were also taken into consideration.

The revision comes after local investors’ group, the Securities Investors Association (Singapore) or SIAS, urged the offerors to improve their terms on March 1. SIAS had issued the note after GEAR’s 64%-owned subsidiary Stanmore Resources reported a surge in earnings to A$727 million ($653.5 million) for FY2022, up from the A$7 million in the FY2021.

On March 3, GEAR announced that the conditions for its proposed transactions were not yet met and that its exit offer may lapse without its shareholders’ approval.

GEAR, on Nov 9, 2022, announced its intention to delist, a day after it was queried by the SGX RegCo for the 25.6% decline in its share price.

In its March 18 filing, GEAR said that it has not received any acceptances for its exit offer. Save for the DSS shares, the offeror has also not acquired or agreed to acquire any other shares.

As at March 18, 6pm, the offeror owns some 77.49% of the total number of issued shares in GEAR.

Shares in GEAR closed 1 cent lower or 1.11% down at 89.5 cents on March 17.

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