SINGAPORE – The founding family of local tile supplier Hafary Holdings has launched a cash offer to take the company private, with shareholders holding nearly 90 per cent of its shares already committed to accepting the bid.
The voluntary conditional offer of 64 cents a share is being made by 23 Capital, a company owned by Hafary chief executive Low Kok Ann and his children, Low See Ching and Audrey Low Bee Lan, according to a Sept 28 exchange filing.
The price is 4.9 per cent above Hafary’s last traded price of 61 cents on Sept 25, and 19.9 per cent above its volume-weighted average price over the preceding 12 months.
Unless a competing offer emerges, the price is final, said 23 Capital. Its offer values Hafary’s 430.55 million issued shares at about $275.6 million.
Hafary’s three family members, who together hold 39.14 per cent of Hafary, have undertaken to accept the offer. Hap Seng Investment Holdings, which holds a further 50.82 per cent, has also given an irrevocable undertaking. Their combined holdings amount to 89.96 per cent of Hafary’s shares.
The offer is conditional on 23 Capital receiving enough acceptances to exercise its right to compulsorily acquire the remaining shares, after which 23 Capital intends to make Hafary a wholly owned subsidiary and delist it from the Singapore Exchange (SGX).
It said it would not take steps to restore the company’s public float if it falls below the required 10 per cent.
Citing Hafary’s low share trading volume as one reason for the offer, 23 Capital added that the move gives shareholders an opportunity to exit at a premium without paying brokerage fees.
Hafary has not raised equity capital through the stock market in the past 10 years and is unlikely to need access to it in the foreseeable future. A privatisation would also save listing costs and give management greater flexibility, it said.
A formal offer document is expected to be sent to shareholders within 14 to 21 days of the announcement, after which the offer will remain open for at least 28 days.
Hafary began in 1980 as a ceramic tile shop in Balestier, co-founded by Low Kok Ann. It has since expanded into stone, mosaics, wood flooring and bathroom fittings, supplying home owners as well as designers, contractors and property developers.
The holding company listed on SGX’s Catalist board in December 2009 and moved to the mainboard in June 2013.
