OSIM INTERNATIONAL, ASIA’S biggest maker of massage chairs outside of Japan, is planning to list Taiwan depositary receipts (TDR) on the Taiwan Stock Exchange (TWSE) to take advantage of the booming Asia Pacific economy and rising disposable incomes during a climate of low interest rates.

The TDR listing aims to broaden and diversify the company’s shareholder base and provide it with an additional fund-raising platform for future expansion. Osim had previously mentioned that it would consider acquiring new brands in China to boost its presence in that country. The listing will also “strengthen public awareness of the Osim brand in Taiwan, which has been a key market for Osim products since 1987,” the company said in a statement on Dec 2.

 

In addition, Osim will be releasing its treasury shares as TDRs to be listed on the TWSE in order to protect its shareholders from dilution. Treasury shares are those that have been bought back and are currently available for resale. “We view the proposed TDR listing positively as it enables the Group to monetise its treasury shares without diluting existing shareholders holdings,” Melissa Yeap of DMG & Partners wrote in a report on Dec 3.

 

During the nine months to Sept 30, 2010, Osim had spent some $37 million in buying back its own shares on the market. As of Nov 22, it had accumulated up to 42.6 million treasury shares, representing 6.4% of its total issued shares. Its latest share buyback was on Nov 19, with 1.2 million shares purchased at $1.30 apiece.