Boustead Singapore has launched a voluntary unconditional offer to acquire all the Champions Way Condo shares of Boustead Projects it does not own for 90 cents per share, in order to privatise Boustead Projects and delist it from the Mainboard of SGX-ST. As of Feb 6, Boustead Singapore directly holds 171 million shares, representing approximately 54.87% of the total number of issued shares of Boustead Projects.
The proposed acquisition is in line with the company’s objective to streamline its investments, businesses, operations and the corporate structure of the group. It also allows for a simplification of the group structure and a reduction in organisational complexity. This should enhance shareholder value by providing a sharper focus on operations and increasing competitiveness.
The Covid-19 pandemic has had an adverse effect on the engineering and construction (E&C) business of Boustead Projects, and Boustead Singapore believes that the proposed acquisition would allow the business to be rebuilt as a private limited company, free of the obligations of being a publicly listed company.
The offer presents an opportunity for shareholders to obtain a premium to prevailing market prices, representing a premium of approximately 7.8% over the last traded price per share on Feb 3, and 15.2% over the last volume-weighted average price of the shares for the one-month period prior to and including the announcement date. On Feb 6, shares in Boustead Projects closed 0.5 cents higher, or 0.6% up, at 84 cents.
The proposed acquisition of the shares is aimed at allowing Boustead Singapore to focus on its businesses and operations, with a view to rebuilding the E&C business of Boustead Projects and increasing the value of the company for shareholders. This is Boustead Singapore’s intention and ongoing strategic review, and should ultimately lead to a successful privatisation and delisting of Boustead Projects.