Lian Beng Group to Acquire and Privatise SLB Development
Scheme of Arrangement
Lian Beng Group’s board of directors, comprising the controlling Ong family, has proposed to acquire and privatise property developer SLB Development via a scheme of arrangement. The announcement was made on January 24.
Scheme Consideration
The scheme consideration for each share is SGD 0.23 in cash. This comes after Lian Beng completed its privatisation in 2023 by the Ong family. It officially delisted in August 2023.
Stake in SLB Development
Lian Beng currently holds about 708.5 million shares in SLB Development, representing about 77.6% of the total number of issued shares.
Premium Offer
The offer price represents a premium of 36.1% over the last transacted price of SGD 0.169. The volume-weighted average price (VWAP) of the shares traded on the Singapore Exchange were SGD 0.149 for the one-month period, SGD 0.142 for the three-month period, SGD 0.136 for the six-month period, and SGD 0.122 for the 12-month period.
Lian Beng’s Capital Structure
Lian Beng has an issued and paid-up share capital of SGD 83.7 million, comprising 499.7 million ordinary shares, excluding 30.1 million shares held in treasury. OSC Capital, its investment holding company, is Lian Beng’s sole shareholder.
OSC Capital’s Structure
OSC Capital has an issued and paid-up share capital of SGD 100, comprising 100 ordinary shares held 51% by Ong Pang Aik, 30% by Ong Lay Huan, 13% by Ong Lay Koon, and 6% held by Ong Lee Yap.
Scheme Benefits
The acquisition will provide shareholders with a unique cash exit opportunity to realise their entire investment. The scheme presents an opportunity for shareholders to realise their investments at a premium without incurring brokerage fees. The scheme consideration represents a premium of about 54.4%, 62%, 69.1%, and 88.5% over the VWAP of the shares traded for the one, three, six, and 12-month periods, respectively, up to and including the last trading day. It also represents a premium of about 16.8% over the net asset value per share of SGD 0.197, as at November 30, 2024.
SLB’s Listing Status
SLB has no need for access to equity capital markets, with no exercises to raise equity capital on the Singapore Exchange since its initial public offering in 2018. The privatisation will allow SLB to save on expenses and costs relating to the maintenance of its listing status.
Post-Acquisition Plans
After the acquisition and the scheme are completed, Lian Beng intends to undertake a review of the operations, management, and financial position of the group and will evaluate and pursue any opportunities arising in the ordinary course of business which it regards to be in its interests. It does not currently intend to make any major changes to the group’s business, redeploy its fixed assets, or discontinue the employment of its existing employees, other than in the ordinary course of business.
Trading Halt
Shares of SLB closed at SGD 0.169 on Wednesday, up SGD 0.009 or 5.6%, before a trading halt was called.
Conclusion
Lian Beng Group’s proposed acquisition of SLB Development presents a unique opportunity for shareholders to realise their investments at a premium. The scheme is expected to provide a cash exit for shareholders without incurring brokerage fees.
FAQs
Q: What is the scheme consideration for each share?
A: The scheme consideration is SGD 0.23 in cash.
Q: How many shares does Lian Beng hold in SLB Development?
A: Lian Beng holds about 708.5 million shares, representing about 77.6% of the total number of issued shares.
Q: What is the premium offer over the last transacted price?
A: The offer price represents a premium of 36.1% over the last transacted price of SGD 0.169.
Q: What is the net asset value per share of SLB Development?
A: The net asset value per share as at November 30, 2024, is SGD 0.197.
