SINGAPORE (Nov 7): Cityneon says it may receive a mandatory unconditional cash offer for all shares in the company under the chain principle of the Singapore code on takeover and mergers.

This comes after Hong Kong-listed Teamway International Group’s subsidiary Mutual Power International entered into an MoU to acquire Massive Right’s 76% stake in Lucrum 1 Investment as well as all the shareholders’ loan owed by Lucrum 1 to Massive Right.

Lucrum 1 owns a 68.95% stake in Cityneon, according to Reuters data.

If the proposed acquisition materialises, Mutual Power and Teamway will own a 84.5% stake in Lucrum 1 and acquire statutory control of the latter.

Under SGX’s chain principle, Mutual Power will, upon completion of the proposed acquisition, be required to make a mandatory unconditional cash offer to acquire Cityneon.

However, Cityneon warns shareholders there is no certainty or assurance that the chain offer will eventually materialise as the MoU is non-legally binding.

Shareholders are also advised to exercise caution when dealing in the shares of the company, adds Cityneon.

Shares in Cityneon closed at $1.16 on Monday, up 2 cents.