Announcement • Sep 27

Singapore Exchange Regulation Directs Boustead Projects to Delist

Singapore Exchange Regulation (SGX RegCo) has issued a directive on September 26, 2023 for the delisting of Boustead Projects Limited, as the issuer has not ensured that at least 10% of the total number of issued shares are held by the public. In its notice of compliance, the frontline regulator also directed Boustead Projects and/or Boustead Singapore Limited to make an exit offer to the shareholders that is "fair and reasonable", with the proposal to be provided within one month from September 26, 2023. Boustead Singapore in February announced a voluntary unconditional general offer to privatise its real estate unit, Boustead Projects. The initial offer price was SGD 0.90 per share, and this was subsequently raised to SGD 0.95 per share on February 22. The independent financial adviser (IFA), PrimePartners Corporate Finance, opined that the offer was "not fair but reasonable". In its report, the IFA noted that the final offer price of SGD 0.95 was not within its final estimated valuation range of between SGD 1.17 and SGD 1.38. At the close of the offer, Boustead Singapore and its concert parties owned or controlled an aggregate of 299.2 million shares, representing approximately 95.5% of the total number of shares in the company. As less than 10% of Boustead Project shares were held by the public, the counter was suspended in March. Boustead Singapore had disclosed previously that it would not be able to avail itself to the powers of compulsory acquisition under the Companies Act. Under section 215(1) of the Companies Act, an offeror who acquires at least 90% of the total number of shares (other than those already held by the offeror, its related corporations or nominees), would be entitled to exercise the right to compulsorily acquire all the shares from shareholders who have not accepted the offer. The offer for Boustead Projects did not extend to 19.28% of the shares that were held through nominees by Chairman And Chief Executive Officer of Boustead Singapore, Wong Fong Fui. SGX RegCo said in March that Boustead Projects must restore its free float after its shares are suspended at the close of the takeover offer by its parent company. Otherwise, Boustead Projects would be directed to delist and provide an exit offer which is deemed fair and reasonable by an IFA. Under listing rules, exit offers in conjunction with voluntary delistings must not only be reasonable, but also fair. An offer is deemed fair if the price offered is equal to or greater than the value of the securities. Boustead Projects was granted two extensions to explore options to comply with listing rules, but did not restore its free float by the September 26 deadline, leading to the notice of compliance and delisting. Shares of Boustead Singapore rose 1.2% on September 26, 2023 to SGD 0.865, before the announcement. Raphael, SGX RegCo directs Boustead Projects to delist, with exit offer that is fair and reasonable.

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