China Lifestyle's jelly products in a China supermarket. NextInsight file photoCHINA LIFESTYLE Food and Beverages Group this morning announced that it is seeking to delist from the Singapore Exchange where it had its IPO in 2005.The manufacturer of confectionary products, such as jelly, cited low trading liquidity for its shares.
The offeror is Rise Mount Group which is making a cash offer of 17.8 cents a share to shareholders, which is a slight discount to its Net Asset Value of RMB1.16 (about 23 Singapore cents).
The offer price is at a 12.8% premium to the stock's average price over the past month.
The stock price, responding to the news, jumped 3 cents, or 20.7%, 17.5 cents by lunch time.
It closed at 16.5 cents at the end of trading today, with 3,659,000 shares changing hands.
The delisting proposal requires the approval of China Lifestyle shareholders at a special general meeting to be convenened.
The resolution has to be approved by a majority of at least 75 per cent of the total number of issued shares (excluding treasury shares) held by shareholders present and voting, on a poll, either in person or by proxy.
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| Source: Bloomberg |
However, China Lifestyle CEO Zheng Yulong, Alliance Food and Beverages (Holding) Company, management shareholders and certain non-management shareholders, who in aggregate own about 424 million shares, representing approximately 84.26 per cent of the total issued shares, have undertaken to the Offeror that they will vote in favour of the delisting resolution.
The Offeror is a special purpose vehicle incorporated for the purpose of the delisting and the Exit Offer.
The sole shareholder of the Offeror is Alliance and the directors of the Offeror are Mr Zheng Yulong and Mr Zheng Yushuang, another Executive Director of China Lifestyle.
The CEO holds 30,490,000 Shares, representing approximately 6.06 per cent of the total issued shares.
Alliance is an investment holding company holding 308,039,540 shares, representing approximately 61.22 per cent. of the total issued Shares.
The entire issued share capital of Alliance is held by the two Mr Zhengs, Mr Zheng Yuhuan, another Executive Director of the Company, and Mr Li Hung Kong , the Non-Executive Chairman of China Lifestyle. All the four are related by family.
