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18-04-2025, 03:20 PM
ANNEX B LETTER FROM THE IFA TO THE INDEPENDENT DIRECTORS
Having considered the above and subject to the assumptions and qualifications set out in this Letter, we are of the opinion that on balance, the financial terms of the Offer are not fair and not reasonable.
In arriving at our opinion, we have considered the following pertinent factors and have placed greater emphasis on asset-based financial ratios given that the Company is in asset intensive business:
(i) we note that the Group has been profitable from FY2022 to FY2024 with net profits increasing from approximately S$3.65 million in FY2022 to approximately S$6.27 million in FY2024. The Group has also declared dividends over the last three financial years with dividend yield ranging between 7.61% and 10.99%. The Group&rsquo s shareholders equities have increase from S$104.74 million in FY2022 to S$107.54 million in FY2024. This implies that the Group is able to generate returns from the deployment of its assets. Accordingly, the steep discount of the Offer Price, on a cash and cash equivalent adjusted basis, from the Ex-cash NAV per Share, Ex-cash NTA per Share, Ex-cash RNAV per Share and Ex-cash RNTA per Share for a company that is profitable, declaring dividends at a high single digit yield and growing shareholders equities with significant cash reserves does not appear to be reasonable
(ii) the Offer Price, as adjusted for cash and cash equivalents of S$0.14 per Share, represents significant discounts to the Ex-cash NAV per Share, Ex-cash NTA per Share, Ex-cash RNAV per Share and Ex-cash RTA per Share that ranged from 72.45% to 80.36%
(iii) The Offer Price represents a premia of over the 1-month, 3-month and 6-month VWAP prior to the Offer Announcement Date that is significantly lower than the mean and median premia of the Selected Comparable Transactions and
(iv) the P/NAV and P/RNAV as implied by the Offer Price is below the median and mean of the P/NAV ratios of the Selected Comparable Transactions.
Accordingly, we advise the Independent Directors to recommend that Shareholders REJECT the Offer.
Having considered the above and subject to the assumptions and qualifications set out in this Letter, we are of the opinion that on balance, the financial terms of the Offer are not fair and not reasonable.
In arriving at our opinion, we have considered the following pertinent factors and have placed greater emphasis on asset-based financial ratios given that the Company is in asset intensive business:
(i) we note that the Group has been profitable from FY2022 to FY2024 with net profits increasing from approximately S$3.65 million in FY2022 to approximately S$6.27 million in FY2024. The Group has also declared dividends over the last three financial years with dividend yield ranging between 7.61% and 10.99%. The Group&rsquo s shareholders equities have increase from S$104.74 million in FY2022 to S$107.54 million in FY2024. This implies that the Group is able to generate returns from the deployment of its assets. Accordingly, the steep discount of the Offer Price, on a cash and cash equivalent adjusted basis, from the Ex-cash NAV per Share, Ex-cash NTA per Share, Ex-cash RNAV per Share and Ex-cash RNTA per Share for a company that is profitable, declaring dividends at a high single digit yield and growing shareholders equities with significant cash reserves does not appear to be reasonable
(ii) the Offer Price, as adjusted for cash and cash equivalents of S$0.14 per Share, represents significant discounts to the Ex-cash NAV per Share, Ex-cash NTA per Share, Ex-cash RNAV per Share and Ex-cash RTA per Share that ranged from 72.45% to 80.36%
(iii) The Offer Price represents a premia of over the 1-month, 3-month and 6-month VWAP prior to the Offer Announcement Date that is significantly lower than the mean and median premia of the Selected Comparable Transactions and
(iv) the P/NAV and P/RNAV as implied by the Offer Price is below the median and mean of the P/NAV ratios of the Selected Comparable Transactions.
Accordingly, we advise the Independent Directors to recommend that Shareholders REJECT the Offer.
https://sgtalk.net/Thread-Sin-Heng-Heavy...ffer-58cts
Always fight lowball offers wherever you go, no matter what the weather, always bring your own sunshine
