Temasek-Backed Group Makes ‘Superior’ $2.89B Offer Topping Keppel in SPH Battle

The bidding war for Singapore Press Holdings’ real estate business escalated again on Monday, as Temasek-backed Cuscaden Peak announced a S$3.9 billion ($2.89 billion) offer that the Straits Times publisher judged “superior” to rival suitor Keppel Corporation’s terms.

The latest bid by Cuscaden — a consortium formed by tycoon Ong Beng Seng and his Hotel Properties group alongside Temasek units CapitaLand and Mapletree — not only one-ups Keppel’s final $2.8 billion offer for SPH made just last week, but it also gives SPH shareholders the choice of accepting all cash or a mix of cash and SPH REIT units in exchange for their shares.

Both options have a higher consideration value of up to S$2.400 per SPH share and a higher proportion of cash consideration than Keppel’s final offer of S$2.351 per share, according to a joint statement issued by SPH and Cuscaden Peak.

“Cuscaden is working expeditiously with SPH for the transaction to complete by February 2022,” the consortium said in a separate release.

Shareholder Option

Cuscaden’s newly-revealed scheme gives each SPH shareholder the option to receive either S$2.360 per share, paid fully in cash, or S$2.400 per share based on S$1.602 paid in cash plus 0.782 SPH REIT units valued at S$0.7984 per SPH share.

Keppel’s final offer, in contrast, would pay S$2.351 per share based on S$0.868 in cash, 0.596 Keppel REIT units and 0.782 SPH REIT units.

In the absence of a superior competing offer, SPH’s directors have preliminarily recommended that SPH shareholders vote against the Keppel deal and in favour of the Cuscaden arrangement, according to Monday’s joint statement.

Additionally, a chain offer for all the units in SPH REIT could be triggered if Cuscaden and its concert parties end up holding more than 30 percent of SPH REIT units.

In a statement early Tuesday, Keppel Corporation showed no sign of moving to best Cuscaden’s gambit, saying: “We believe that Keppel’s final offer is a compelling one and a win-win proposition which would be put to both Keppel Corporation’s and SPH’s shareholders for their respective decisions.”

Temasek Tussle

Keppel’s plan to acquire SPH’s non-media business, first announced in August, drew a rival bid from an unlikely source when Cuscaden Peak in late October proposed an all-cash consideration of S$2.10 for each share of SPH.

Companies controlled by billionaire Ong and SGX-listed Hotel Properties hold 40 percent of Cuscaden Peak, while CapitaLand and Mapletree own 30 percent each. Singapore state holding firm Temasek in turn owns 52 percent of CapitaLand and the entirety of Mapletree.

Keppel, whose biggest shareholder happens to be Temasek, had originally offered the equivalent of S$2.099 per SPH share in a cash-and-scrip deal valuing the company at $2.5 billion before later boosting its final bid to S$2.351 and $2.8 billion.

All the proposals are contingent on SPH spinning off its media business — which includes the Straits Times, the Business Times and various newspapers published in Chinese, Malay and Tamil — into a not-for-profit entity.

SPH controls the manager of SPH REIT, which owns the Paragon, Clementi Mall, Rail Mall and other shopping centres in Singapore, as well as the Figtree Shopping Centre in Sydney and the Westfield Marion mall in South Australia. SPH directly owns the Seletar Mall and Woodleigh Residences in Singapore, as well as student accommodation in the UK and Germany.