Green Esteel’s Bold Takeover Bid for HG Metal Manufacturing

Green Esteel Pte. Ltd. has announced a mandatory conditional general cash offer to acquire all the issued and paid-up ordinary shares of HG Metal Manufacturing Limited, excluding treasury shares and those already owned by Green Esteel and its concert parties. This move comes following Green Esteel’s substantial acquisition of shares through a rights issue, triggering an obligation to make an offer under Singapore’s Code on Take-overs and Mergers.

Key Points of the Offer

• The offer price is set at S\$0.266 per share, which is final unless revised in a competitive situation.
• The offer is contingent upon Green Esteel acquiring more than 50% of the voting rights of HG Metal.
• Green Esteel’s participation in the rights issue increased its shareholding to 44.44%, surpassing the 30% threshold that necessitates a mandatory offer.

Important Considerations for Shareholders

Shareholders should note that the offer price represents a 0.4% premium over the last transacted price before the offer announcement date, but a discount when compared to historical volume-weighted average prices over one to six months. This pricing strategy and the potential shifts in shareholding could impact HG Metal’s stock value significantly.

Listing Status and Potential Delisting

There are implications for HG Metal’s listing status on the SGX-ST. Should Green Esteel’s shareholding exceed 90%, trading may be suspended unless at least 10% of shares remain in public hands. While Green Esteel currently intends to maintain HG Metal’s listing status, it retains the right to reassess this decision based on future developments.

Rationale and Future Plans

Green Esteel aims to continue developing HG Metal’s existing businesses without major management or operational changes. However, the company holds the flexibility to explore opportunities that align with the best interests of HG Metal.

Financial Backing and Offer Document

Oversea-Chinese Banking Corporation Limited has confirmed the availability of sufficient financial resources to support full acceptance of the offer. Shareholders can expect the electronic dispatch of the offer document within 14 to 21 days from the announcement date.

Disclaimer

This article contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those projected. Shareholders and investors should seek independent advice before making any investment decisions.

View HG Metal Historical chart here