CFA Institute Singapore
SINGAPORE (Aug 24): An entity called Ultimate Horizon has made a 0.0182 cent per share offer to take over Blumont Group.
The takeover deal values Blumont at $5.8 million, which is more than 80% off its market value of $31.65 million based on its last traded share of 0.1 cent.
Blumont was one of the three counters at the centre of the penny stock saga of October 2013 whose alleged mastermind John Soh Chee Wen is now in remand and awaiting trial.
Headquartered in Singapore, Blumont's businesses include investment holding, sterilisation of food packaging and medical devices, property as well as mineral and energy resources.
In an SGX announcement, Blumont said that Ultimate Horizon had earlier today bought over 69.56% of the company for $4 million. This purchase works out to an average price of 0.018172 cent, which is a discount of more than 80% over the counter’s last traded price of 0.1 cent.
While the offer price is a massive discount off the last traded price, it is actually not too far off the company’s net asset value. As of June 30, Blumont’s NAV was 0.02 cent, down from 0.03 cent at Dec 31 2016.
According to Blumont’s FY2016 annual report, as of March 27, its largest shareholder is Platinum Partners Value Arbitrage Fund LP, which held 48.60% of the company.
The second largest shareholder is the Platinum Partners Credit Opportunities Master Fund LP, which held another 35%.
Ng Kim Huatt, the company’s sole executive director, holds 100 million shares, or 0.36%.
With Ultimate Horizon having assumed ownership of more than 30% of Blumont, under listing rules of the Singapore Exchange, a compulsory general offer has to be made to the rest of the shareholders.
According to Blumont’s announcement, Ultimate Horizon is solely-owned by a Malaysian businessman Siaw Lu Howe, whose interests are mainly in the state of Sarawak in areas ranging from hospitality, real estate and mining services. Besides Siaw, Ultimate Horizon has another director, Kek Wei Na.
On Aug 14, Blumont losses for the quarter to June 30 nearly doubled to $5.35 million from $2.8 million a quarter earlier. Revenue in the same period fell 9% to $861,000.