Low Keng Huat (Singapore)

[dydx]

Just for discussion, if Marco and Wang are willing to strike a deal for Wang's 7.29% at say $0.88 - and this price will be given to all other shareholders who have accepted the GO and those yet to accept, and if UOB Kay Hian goes to SIC to ask for approval to proceed, would SIC say "no"?

The word "final" has its legal implications. It cannot be simply ignored. Otherwise, anyone can say this is a "final" offer and then proceed to strike a deal with another party at a higher price during the offer period.

Another thing to note is that what happens to those shareholders who sold their shares in the market after the offeror announced that 78c is the final offer? Are you going to compensate them with 88c as well? If not, why? If yes, how much it is going to cost you and also track them down?

No point speculating what Wang would do with his 7.29%. If a deal is agreed between him and Marco, UOB Kay Hian will have to announce the Offeror has crossed 90% and the GO becomes unconditional. Let's hope the Offeror will also announce a revision of the price at the same time.

We should note that before the Offeror revised the price to $0.78 on 13Jan, they did not buy from the market. On 14Jan Wang mopped up the shares in the market and raised his stake to 7.29% (from 1.4% previously). Offeror responded on 15Jan and started to mop up loose shares from the market and continue doing so.

We should also note Offeror's final offer is for acceptances under the GO. Shareholders selling into the market are doing so at their own accord, so can't blame the Offeror if a deal is done which brings them above 90%.

[ghchua]

We should also note Offeror's final offer is for acceptances under the GO. Shareholders selling into the market are doing so at their own accord, so can't blame the Offeror if a deal is done which brings them above 90%.

But according to the rule, if a deal is done at a price higher than the offer price during the offer period, the offeror will have to revise the offer price higher. But since the offeror already said the offer price is final, then they cannot do a 88c deal to bring it to above 90%. It can only do a deal that is 78c or lower.

What I am trying to say here is that shareholders selling into the market know that the offer price is final. It cannot be revised and then say it is for only acceptances under GO, knowing that it is the final price. Logically, it doesn't make sense and I think legally as well.

[dydx]

We should also note Offeror's final offer is for acceptances under the GO. Shareholders selling into the market are doing so at their own accord, so can't blame the Offeror if a deal is done which brings them above 90%.

But according to the rule, if a deal is done at a price higher than the offer price during the offer period, the offeror will have to revise the offer price higher. But since the offeror already said the offer price is final, then they cannot do a 88c deal to bring it to above 90%. It can only do a deal that is 78c or lower.

What I am trying to say here is that shareholders selling into the market know that the offer price is final. It cannot be revised and then say it is for only acceptances under GO, knowing that it is the final price. Logically, it doesn't make sense and I think legally as well.

The final price of $0.78 is under the GO and is for shareholders accepting the GO which is conditional on the Offeror securing not less than 90%. Shareholders accepting the GO will only get paid $0.78/share after the Offeror declares the GO becoming unconditional - i.e. Offeror having secured 90% or more. Those who choose to sell into the market get and accept free market prices and payment in T+2 days.

In the 16Jan announcement, UOB Kay Hian merely said that the Offeror does not intend to revise the Final Offer Price.  This is different from saying the Offeror will not, and this is before Wang raising his stake to 7.29% the next day. Circumstances have changed. If the Offeror wants to secure 90%, Wang's 7.29% is key now. Otherwise, the GO will likely fail, and the Offeror may end up having to return the shares to those who have accepted the GO.

Marco is paying $0.78 for something that is worth significantly more, so he has enough leeway in revising the GO price in order to achieve success.

[Corgitator]

Those who choose to sell into the market get and accept free market prices and payment in T+2 days. 

Comments: If I may add, those who chose to sell now in the secondary market accepted free market prices and payment in T+2 while relying on the Offeror's representation that the offer is final.

UOB Kay Hian merely said that the Offeror does not intend to revise the Final Offer Price.  This is different from saying the Offeror will not 

Comments: How is it different? I'm curious, has there ever been a case where that statement was made, and the Offeror subsequently made a higher offer when there's no competing offer from another buyer?

Marco is paying $0.78 for something that is worth significantly more, so he has enough leeway in revising the GO price in order to achieve success. 

Comments: Does he really have leeway in this GO after saying that the offer is final? Why couldn't he just give up now, let the share price fall and try again a year later, or whenever sentiment is bad and minorities are more likely to capitulate? If that doesn't go well again, just repeat it again and again. I guess the key is to figure how much the Offeror wants the GO to go through, and who (minority or controlling shareholders) is more patient.

[ghchua]

Hi dydx and Corgitator,

I think I will have to refer both of you to the takeover code. Actually, I do not wish to do it because it is very long and a lot of legal stuff. But here it is:
https://www.mas.gov.sg/-/media/mas/resou...y-2019.pdf

And I refer both of you to Page 124 and Page 125, 20.2 No increase statements.

20.2 No increase statements
If the offeror or a person on behalf of the offeror has made a "no increase" statement
and it is not withdrawn immediately if incorrect, the offeror will not be allowed
subsequently to amend the terms of the offer in any way even if the amendment would
not result in an increase in the value of the offer, except in wholly exceptional
circumstances or where the right to do so has been specifically reserved.
NOTES ON RULE 20.2
1. Firm statements
In general, an offeror will be bound by any firm statement as to the finality of its
offer. In this respect, the Council will treat any indication of finality as absolute,
unless the offeror clearly states the specific circumstances in which the
statement will not apply. The Council will not distinguish between the precise
words used, e.g. the offer is "final" or will not be "increased", "amended",
"revised", "improved" or "changed". The Council will regard any statement of
intention as a firm statement.
2. Reservation of right to set statements aside
A no increase statement may be set aside only if the offeror has specifically
reserved the right to do so at the time the statement was made; this applies
whether or not the offer was recommended at the outset. The first document
sent to shareholders in which mention is made of the no increase statement
must contain prominent reference to this reservation (precise details of which
must also be included in the document.) Any subsequent mention by the offeror
of the no increase statement must be accompanied by a reference to the
reservation or, at the least, to the relevant sections in the document containing
the details.
If a competitive situation arises (see Notes on Rule 22.6 and Rule 29) after a
no increase statement is made, the offeror can choose not to be bound by it
and be free to increase the offer only if he has specifically reserved the right to
set aside the no increase statement when such statement was made and
provided that:-
(a) the offeror gives notice to increase the offer within four business days
of the announcement of the competing offer; and
(b) the offeree company's shareholders, who accepted the offer after the
date of the no increase statement, are given a right of withdrawal for a
period of 8 days following the date on which the notice to increase the
offer is posted.

[Shiyi]

Hi dydx and Corgitator,

I think I will have to refer both of you to the takeover code. Actually, I do not wish to do it because it is very long and a lot of legal stuff. But here it is:
https://www.mas.gov.sg/-/media/mas/resou...y-2019.pdf

And I refer both of you to Page 124 and Page 125, 20.2 No increase statements.

20.2 No increase statements
If the offeror or a person on behalf of the offeror has made a "no increase" statement
and it is not withdrawn immediately if incorrect, the offeror will not be allowed
subsequently to amend the terms of the offer in any way even if the amendment would
not result in an increase in the value of the offer, except in wholly exceptional
circumstances or where the right to do so has been specifically reserved.
NOTES ON RULE 20.2
1. Firm statements
In general, an offeror will be bound by any firm statement as to the finality of its
offer. In this respect, the Council will treat any indication of finality as absolute,
unless the offeror clearly states the specific circumstances in which the
statement will not apply. The Council will not distinguish between the precise
words used, e.g. the offer is "final" or will not be "increased", "amended",
"revised", "improved" or "changed". The Council will regard any statement of
intention as a firm statement.
2. Reservation of right to set statements aside
A no increase statement may be set aside only if the offeror has specifically
reserved the right to do so at the time the statement was made; this applies
whether or not the offer was recommended at the outset. The first document
sent to shareholders in which mention is made of the no increase statement
must contain prominent reference to this reservation (precise details of which
must also be included in the document.) Any subsequent mention by the offeror
of the no increase statement must be accompanied by a reference to the
reservation or, at the least, to the relevant sections in the document containing
the details.
If a competitive situation arises (see Notes on Rule 22.6 and Rule 29) after a
no increase statement is made, the offeror can choose not to be bound by it
and be free to increase the offer only if he has specifically reserved the right to
set aside the no increase statement when such statement was made and
provided that:-
(a) the offeror gives notice to increase the offer within four business days
of the announcement of the competing offer; and
(b) the offeree company's shareholders, who accepted the offer after the
date of the no increase statement, are given a right of withdrawal for a
period of 8 days following the date on which the notice to increase the
offer is posted.

Not only the offer price is Final, the closing date for acceptance (Feb 13) is also Final. Such is the game of brinkmanship by the offeror.

[ghchua]

Dear all,

Asdew's Wang had disposed all his stake in Low Keng Huat today in the market at 78c per share.
https://links.sgx.com/1.0.0/corporate-an...c7fa7b0143

[weijian]

We should note that before the Offeror revised the price to $0.78 on 13Jan, they did not buy from the market. On 14Jan Wang mopped up the shares in the market and raised his stake to 7.29% (from 1.4% previously). Offeror responded on 15Jan and started to mop up loose shares from the market and continue doing so.

Hi dydx, 
I believe one of the main reason that Offeror did not buy from the market before 13th Jan was because the price was almost always higher than the previous offer price of 72cents. In essence as per takeover code, the Offeror cannot pay anything more than what has been last officially announced.

Dear all,

Asdew's Wang had disposed all his stake in Low Keng Huat today in the market at 78c per share.
https://links.sgx.com/1.0.0/corporate-an...c7fa7b0143

Dear ghchua,

Based on what the Offeror announced at the end of yesterday, they were the buyer of Mr Alan Wong's entire stake. So as you mentioned, it does seem that Mr Alan Wong was doing a "quick smash and grab" arb ops. I suppose he may have gotten wind that the UOB KayHian would be "slow" to start open market purchases (13th Jan after market close: Offer revised. 14th Jan: Mr Alan Wong purchased from open market. 16th Jan: UOB KayHian start purchasing on the open market)

Another interesting thing to note: Mr Alan Wong disposed 58.546mil shares yesterday. But when he first announced the 14th Jan purchase, he had 53.893mil shares. So basically he increased his stake by ~8% (close to 4.5mil shares) in the past week as well.

Now that this "blocking stake" is gone, Dato' Marco has a clear path for his offer to turn conditional.

[ghchua]

Dear all,

An update. After yesterday, as things stand:

1. The IFA had given a updated opinion on the revised offer at 78c. It remains as "not fair but reasonable". Which means, unless the offeror can secure 90% of the shares that they do not own when they first made the offer (not 90% of all the shares out there), they would not be able to delist the company according to SGX rule since the offer is deemed not fair. If they secure it, they would be able to exercise compulsory acquisition and acquire all the remaining shares out there and delist the company, regardless of IFA opinion.

2. The offeror had secured 92.19% of all the shares as of yesterday via open market acquisitions and acceptances. But do remember that the offer is conditional on them securing 90% of the shares that they do not own when they made the offer. It is still a conditional offer as of yesterday. And if they failed to do that when they hit the final closing date on 13 Feb 26, they would have to return all the shares that they have accepted through the offer during the offer period. Whether the stock will be suspended if the offer fails after it closes will depend on how much shares had been returned back to shareholders via acceptance. The free float to remain traded is 10% or more.

In short, this offer is now a CACO combo condition. Compulsory Acquisition plus Conditional Offer (i.e. CACO). They will get both if they secure 90% of the shares that they do not own when they made the offer. Which means, it will turn unconditional and they can compulsory acquire all the remaining shares out there. If not, both failed and shares remain listed.

Hope that the above helps.

[weijian]

In short, this offer is now a CACO combo condition. Compulsory Acquisition plus Conditional Offer (i.e. CACO). They will get both if they secure 90% of the shares that they do not own when they made the offer. Which means, it will turn unconditional and they can compulsory acquire all the remaining shares out there. If not, both failed and shares remain listed.

Hope that the above helps.

CACO has been achieved. Dato has won the game of brinksmanship.

DEALINGS DISCLOSURE LEVEL OF ACCEPTANCES OFFER DECLARED UNCONDITIONAL IN ALL RESPECTS INTENTION TO EXERCISE RIGHTS OF COMPULSORY ACQUISITION

As at 6.00 p.m. (Singapore time) on 5 February 2026, the total number of Shares owned, controlled, or agreed to be acquired by the Offeror (including valid acceptances of the Offer) amount to an aggregate of 705,376,505 Shares, representing approximately 95.47% of the total number of Shares

https://links.sgx.com/FileOpen/LKHS%20-%...eID=874321