SINGAPORE: The chairman and chief executive officer (CEO) of Osim International, Mr Ron Sim, on Monday (Mar 7) announced his intention to buy out the minority shareholders to privatise the company.
Mr Sim had made a voluntary unconditional cash offer of S$1.32 for the shares that he does not already own - valuing the whole company at around S$980 million - and this was made through his private investment vehicle Vision Three, the press release said.
Mr Sim currently owns 68.31 per cent of the company, and he will need to raise his stake to 90 per cent before he can take Osim private. His offer represents a premium of approximately 8 per cent on the last traded price per share on the Singapore Exchange.
OCBC said the offer price appears reasonable, given the tough environment ahead and the lack of strong drivers for earnings growth.
But the Securities Investors Association (Singapore) (SIAS) said low share prices could mean more privatisation bids, and investors need to do their homework when faced with such offers.
Said Mr David Gerald, president and CEO of SIAS: "Minority shareholders are entitled to know from the company, at the appropriate time, why the company is doing this and whether the company is offering a reasonable price that is acceptable to them.
"How do they determine this? They do this by waiting for the independent financial advisors' report which under rule 119 in the listing rules is a requirement. Anyone who wishes to de-list or take the company private must make a mandatory reasonable offer and that the offeror should appoint an independent financial advisor."