Chemical Industries (FarEast) Limited

[weijian]

hi specuvestor,
The business already looks stagnant before the old man passes on. So the question is, would there be some unlocking of value when he does? That said, the valuable assets are highly illiquid and so unlocking of value probably takes time.
The "Independent" Chairman and the newly hired CEO has no skin in the game as you pointed out. If it is some sort of charity trust, wouldn't it be a relatively good outcome for OPMIs? After all, charities need money, giving certain assurance of capital reductions/dividends.
Another typical business worth more dead than alive. Unless one is the wealth manager for the Family trust or knows some of the family members, it is better to stay on the sidelines.

Emeritus Chairman has passed on. The share price is scarcely traded but experienced ~10% jump when obituary and AGM was held on 29th July...

Annual General Meeting

Mr Lim Soo Peng, the visionary founder of Chemicals Industries (Far East) Ltd Group of companies, passed away on peacefully on 27 July 2026 at the age of 99. 

Mr Lim established the company in response to the Singapore Government’s invitation to support Singapore’s industrialisation programme in the 1960s. Under his leadership, the business evolved from a leading commodities trading house into a manufacturer and supplier of essential chemicals for clean water. 

Mr. Lim has served the Company for over six decades in both executive and nonexecutive roles since its SGX Mainboard incorporation. He played a pivotal role in driving the Group’s long-term growth, succession planning, professionalization, and Board renewal.

Following his retirement from the Board in July 2025, Mr. Lim continues to serve as Founder, Emeritus Chairman and Senior Adviser, providing strategic guidance when requested. A former Member of Parliament and long-serving Justice of the Peace, he has also contributed extensively to public service and was honored with multiple national and business awards in recognition of his achievements.

AGM slides: https://links.sgx.com/FileOpen/20260729%...eID=897834

[specuvestor]

Wow Weijian interesting.... would you pick up this cigar butt and wait for corp action? Asking so to see if what we discussed 3 years ago still stand since the catalyst has happened

Yes this is more like a cigar butt investing that you hope it’s not dirtied too much by the previous owner for your last puff 😂

Having charity run your business is akin to accountants taking over. They are not businessman. Maybe not bad outcome if dead is better than alive 😅 That’s the stark distinction of why Chapter 11 works better than our JM system.

[weijian]

Wow Weijian interesting.... would you pick up this cigar butt and wait for corp action? Asking so to see if what we discussed 3 years ago still stand since the catalyst has happened

Yes this is more like a cigar butt investing that you hope it’s not dirtied too much by the previous owner for your last puff 😂

Having charity run your business is akin to accountants taking over. They are not businessman. Maybe not bad outcome if dead is better than alive 😅 That’s the stark distinction of why Chapter 11 works better than our JM system.

Hi specuvestor,

During that time, I looked at quite a no. of cigar butts and concluded that I do not have the temperament for cigar butt investing.

On another note, Grandpa Wee has passed on in early 2024 but the UOB cross-holding web of companies still stands strong as of 2.5years later. From the MoM that I read from each of the UOB affiliated companies, the cross holdings remain long term strategic investments. So therefore, a "passing" may not necessarily be a catalyst.

Unless one has insights to Emeritus Chairman's legacy planning (given his martial woes), I don't see any "special situations" opportunity.

[specuvestor]

Understand... I'm not a fan of cigar butt as well but this is a case study that we can use as a thought experiment as we discuss / pick each other's brains

The diff with UOB seems to be, based on your notes, that the children in this case has a contentious relationship so likely not to continue this business or maybe infighting, both leading to the sale of the stock holding.

That said however I would conservatively want to see how the holding is distributed first though it seems there are more garang buyers past week

Nice write up Weijian Looks like the major risk is actually the structure ie shareholding / management after the old man move on. If it is passed to a passive trust or charity, since it seems his family relationship is suboptimal,  the business and management might likely be stagnant when there's no skin in the game.
Optimal case is of course a sale

[weijian]

Hi specuvestor,

From I mapped out via public sources:

(A) Emeritus Chairman has 4 sons - 3 from first wife and 1 from secretary. Of the 3 sons from the 1st wife, 2 of them were executive directors (ED) from the 1980s onwards for various periods.

(B) First wife: Of the 3 sons, the longest serving one is Cecil who was on the BOD from 1992 to 2006, and then from 2016 to 2021. The gap of 10years between 2006-2016 was probably due to his bankruptcy status (as a result of a divorce suit) and together with Cecil's son, both son/grandson were "purged" in 2021 for whistleblowing against Emeritus Chairman. 2nd son served with Cecil in similar time periods but stepped down when 3rd son came up. 3rd son is a doctor and only served in NED position for 1 year before Cecil returned in 2016.

( C) The 4th son (from secretary) served as a NED since 2019.

Since sons had once served in various ED/NED capacities, it is plausible for some succession drama.

Next, family trust actually does not have majority control as it owns only ~49%. The next 2 biggest shareholders are Great Eastern (not sure if they are managing it on behalf of someone or is part of their mutual fund holdings)-17.7% and a Msian company-6.6%. So any actions probably require the blessings of this two big shareholders. In 2020, Cecil ranted about "an advisor not been appointed correctly" and he could be referring to the independent chairman (Yeo) appointed the prior year. Interestingly, when Yeo came up for election in 2020, ~13.5mil of votes was against his appointment and this roughly matches to Great Eastern's ownership.

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With regards to the garang buyers --> one thing I learnt over the years: they might be insiders, knowing something that others don't.  But of course, there should also be pure garang buyers too. What we see is the end result of price actions but that does not give much granularity to the composition of the buyers.

[weijian]

There is an on-going review on its SG mfg ops and shifting to a lower cost area to match to its competitors will probably be the solution taken to "continue the Company as an institution". 4th son knows his daddy's heart and capital that is unlocked from selling the 2 investment properties, I suppose will largely be used to continue daddy's legacy.

MINUTES OF THE ANNUAL GENERAL MEETING OF THE COMPANY HELD AT 3 JALAN SAMULUN, SINGAPORE 629127 ON 29 JULY 2026 AT 10.00 A.M.

Question specifically directed at Mr Lim Yew Nghee relating to the resolution on his re-election: Could Mr Lim give his overview and insights on the Company?

We have gone through a period of professionalizing our management. I have confidence in the management team. What we have done in the last few years is to improve on data collection and accessibility to improve the whole management process. Today, we have a lot more clarity on our operations and cost components. We can assess what is the right kind of production and where we want our profitability to come from.

Regarding the questions that we have so much cash, why don’t we sell our properties and return cash to shareholders, these are easy solutions. The difficult questions would be how to move forward for the Company to be sustainable, and if so, what would that be in terms of our manufacturing footprint. We have S$24 million in cash, but if we were to move our chlor-alkali factory to a region with similar capacity, the cost of investment would be approximately S$100 million or at the minimum S$20 million, and we may have to keep our properties as security for funding. The Board and management are tasked with the challenging proposition to chart the future of the Company. The Board has taken insights from management and today we have some good ideas from shareholders. We have ambitions to continue the Company as an institution, and we are confident that we can do it.

MoM: https://links.sgx.com/FileOpen/20260729_...eID=902420