Lian Beng’s $251M Buyout Moving Forward as Shareholders Accept Chairman’s Sweetened Offer

The Ong family behind Lian Beng Group has persuaded enough shareholders to accept a sweetened buyout offer for the Singapore-listed developer for the privatisation to move ahead towards a delisting.

Led by Lian Beng chairman and patriarch Ong Paik Ang, the family’s investment vehicle OSC Capital announced Tuesday in an SGX filing that it had obtained valid acceptances from holders representing 90.14 percent of the total number of issued shares in the company.

Having secured agreements to purchase over 90 percent of the total number shares, the Ongs and their allies are now entitled to exercise the right to compulsorily acquire all shares in Lian Beng from holders who have not accepted the final offer price of S$0.68 a share.

“The offeror will, in due course, despatch the relevant documentation required under the Companies Act in relation to the exercise of its rights of compulsory acquisition to the dissenting shareholders,” financial advisor UOB said in the filing. “Further announcements will also be made by the offeror in due course in relation to the status of the compulsory acquisition.”

Bowing to Pressure

In April, the Ong family announced a voluntary unconditional cash offer of S$0.62 a share for Lian Beng. At the time, the Ongs made note of the “generally low” trade volume in Lian Beng after the family’s buy-up of shares triggered a mandatory general offer in 2021.

The family’s view is that Lian Beng is unlikely to require access to Singapore equity capital markets in the foreseeable future and could tap other funding sources such as bank borrowings, therefore removing the need for an SGX listing, according to the filing.

After hearing criticism of their “lowball offer” from commentators and the Securities Investors Association Singapore, the Ongs raised the final price to S$0.68 a share, valuing Lian Beng at S$339.8 million ($251.4 million).

With the stock no longer meeting the Singapore Exchange’s free-float requirement of at least 10 percent of the shareholding in public hands, the bourse will suspend trading of the shares at the close of the offer on Friday, with delisting and privatisation expected to follow.

Boustead Projects in Limbo

The Lian Beng deal follows a recent spate of attempted and completed delistings of SGX-quoted property firms including SingHaiyi Group, Chip Eng Seng, Global Dragon and Boustead Projects.

In March, Boustead Singapore announced that it had received acceptances from shareholders representing more than 90 percent of the issued shares in Boustead Projects for a revised offer of S$0.95 a share after critics baulked at the initial price of S$0.90. But the privatisation of the property and construction division hit a snag when regulators blocked the compulsory acquisition and ordered a restoration of the stock’s free float.

Last month, Boustead Projects said it had won a second three-month extension to 26 September in which to comply with the free-float rule, as it continues to “explore options that will enable the company to comply with listing rule requirements”.