Jurisdiction - Singapore
Reports and Analysis
Asia Pacific – Regional M&A Update: First Quarter 2015.

23 April, 2015

 

Legal News & Analysis – Asia Pacific

 

Singapore


Mandatory Conditional Cash Offer For All Issued And Paid-up Ordinary Shares In The Capital of IPC Corporation Ltd


The Capital Markets / M&A Practice Group acted for Oei Hong Leong in his mandatory conditional cash offer for all the issued and paid-up ordinary shares in the capital of IPC Corporation Ltd, other than those already held by Oei Hong Leong.


IPC is engaged in the investment and development of properties primarily in the Asia Pacific region and America. The businesses of IPC and its subsidiaries include investment holding, property investment, property development, investing and reselling properties, property consulting and sale and distribution of telecommunication products. IPC is valued at SGD 145 million based on an offer price per IPC share of SGD 0.17.


Mr. Oei Hong Leong is a Singaporean businessman with interests in a range of industries including property development and property holding. He is the Chairman of, among others, Oei Hong Leong Foundation Pte. Ltd., Oei Hong Leong Art Museum Limited and Canadian Metropolitan Properties Corporation. He is also a substantial shareholder of two publicly listed companies in Singapore.


Recommended Voluntary General Cash Offer By United Overseas Bank Limited for Far Eastern Bank Limited


The Capital Markets / M&A Practice Group also acted for United Overseas Bank Limited (UOB) in its recommended voluntary conditional cash offer to acquire all the ordinary shares in the capital of Far Eastern Bank Limited (FEB) other than those already held by UOB (“Offer Shares”). The offer was jointly announced by UOB and FEB as a recommended offer, being recommended at the outset by the independent financial adviser appointed by FEB. UOB owns 78.88% of the shares in FEB and made the offer with a view of privatising FEB. The offer values FEB at SGD 351.04m based on the offer price of SGD 3.51 per FEB share.


The offer will be conditional upon UOB’s reception of at least90% of the Offer Shares. In connection with the offer, UOB had obtained irrevocable undertakings from certain shareholders of FEB to, inter alia, accept the offer in respect of FEB shares held by them, representing an aggregate of approximately 5.39% of the total number of issued FEB shares.


UOB is listed on the Main Board of the SGX-ST. It provides a wide range of financial services, including personal financial services, private banking, commercial and corporate banking, investment banking, corporate finance, capital market activities and asset management, through its global network of branches, offices, subsidiaries and associates. FEB is a banking subsidiary of UOB.


SGD 1.9 Billion Voluntary Conditional Offer For United Envirotech Ltd


The Capital Markets / Mergers & Acquisitions Practice acted for CITIC Limited and its affiliates (CITIC) and CKM (Cayman) Company Limited (the “Offeror“) in the offer for United Envirotech Ltd. for approximately SGD 1.9bn in voluntary conditional cash. The Offeror is a consortium vehicle between CITIC and Kohlberg Kravis Roberts & Co. L.P. (KKR). The CITIC group is the largest conglomerate in the PRC and its businesses include financial services, resources and energy, manufacturing, real estate and infrastructure, engineering contracting and other businesses in the PRC and overseas.


KKR is a leading global investment firm that manages investments across multiple asset classes including private equity, energy, infrastructure, real estate, credit and hedge funds. United Envirotech Ltd. is listed on the Main Board of the Singapore Exchange Securities Trading Limited and is a leading membrane-based water and wastewater treatment and recycling solutions provider with businesses mainly in the PRC’s chemical, petrochemical and industrial park sectors.

 

China


China’s Draft Foreign Investment Law


In January, the Ministry of Commerce of the People’s Republic of China (the “Ministry”) published a Draft Law on foreign investments for public consultation. If passed, the Draft Law will replace the existing Foreign Invested Company Law, the Sino-Foreign Equity Joint Venture Law and the Sino-Foreign Cooperative Joint Venture Law, and grant foreign investors more access to the Chinese market.


According to the Draft Law, the PRC State Council will publish a Negative List of industries in which foreign investment is restricted or prohibited, similar to the model adopted by the China (Shanghai) Pilot Free Trade Zone. It is generally expected that most foreign investment projects will no longer require pre-approval by the Ministry or its local agency when the Draft Law comes into effect. This will reduce the time required for foreign investment projects and offer parties greater flexibility in structuring their investment as relevant contracts, such as joint venture contracts and equity transfer agreements, will no longer require the Ministry’s approval.


At this point in time, the Draft Law is still undergoing the legislative process, and the Draft Law may undergo significant amendments before it is finalised.

 

Indonesia


PT XL Axiata Tbk sold its telecommunication towers for USD 460m to PT Solusi Tunas Pratama Tbk


Our Partners at Assegaf Hamzah & Partners advised PT XL Axiata Tbk through the tender process of its telecommunication towers which were finally sold to PT Solusi Tunas Pratama Tbk for 5.6tn rupiah (USD 460m), that helped it cut mounting debt. The negotiation before the declaration of the winning tender was complex and intense because there were six bidders who participated in the tender process, and Assegaf Hamzah & Partners had to cater to the bidders’ due diligence requests and amendment proposal for the transaction documents.


Malaysia


Takeover Of Masterskill Education Group Berhad


During the last quarter of 2014, our Partners at Christopher & Lee Ong, Christopher Lee and Yon See Ting acted for Arenga Pinnata Sdn Bhd, a subsidiary of Creador II, LLC in the takeover of Masterskill Education Group Berhad. Creador is a private equity fund which focuses on making investments in growth-oriented businesses in South-East Asian countries, primarily in India, Indonesia, Singapore and Malaysia. Its objective is to identify and tap into opportunities for long-term value creation through partnerships with entrepreneurs to grow world-class businesses. Masterskill is a public company listed on the Main Market of Bursa Malaysia Securities Berhad and is principally engaged in the provision of education services, support services, physiotherapy and rehabilitation services.


Takeover Of Integrax Berhad


Since the first quarter of 2015, Christopher Lee and Yon See Ting have been acting for Integrax Berhad and they advise the board of Integrax in connection with the offer by Tenaga Nasional Berhad to take over Integrax. Integrax is a public limited company listed on the Main Market of Bursa Malaysia Securities Berhad, Malaysia. It currently operates two terminals, namely the Lekir Bulk Terminal and the Lumut Maritime Terminal. The Lekir Bulk Terminal handles mainly coal for Tenaga Nasional Berhad ‘s current 2,100 MW power plant in Manjung, Perak, Malaysia while the Lumut Maritime Terminal handles dry and liquid bulk.

 

Myanmar


Revised Draft Of Investment Law


The Directorate of Investment and Company Administration recently released the second official draft of the Myanmar Investment Law on 27 February 2015. The Myanmar Investment Law is currently drafted with assistance from the International Finance Corporation and seeks to repeal and consolidate the Myanmar Citizens Investment Law 2013 and the Foreign Investment Law 2012.


Key features of the draft Investment Law include:


1. Restructuring of the Myanmar Investment Commission
2. Concept of foreign investors
3. Prohibited/Restricted Sectors
4. Freedom to employ foreign skilled labour
5. Enhancement of repatriation and mortgage rights
6. Investment incentives


The draft MIL demonstrates impetus by the Myanmar Government to improve the investment regime in Myanmar. However, certain provisions of the draft law still lack clarity, and there remain questions about how they would operate in practice.

 

Rajah & Tann

 

For further information, please contact:

 

Wee Hann Lim, Partner, Rajah & Tann
wee.hann.lim@rajahtann.com

 

Lawrence Tan, Partner, Rajah & Tann
lawrence.tan@rajahtann.com

 

John Cordova, Partner, Rajah & Tann
john.cordova@rajahtann.com

 

Chester Toh, Director, Rajah & Tann
chester.toh@rajahtann.com

 

Lih Shyng Yang, Partner, Rajah & Tann
lih.shyng.yang@rajahtann.com

 

Ahmad Fikri Assegaf, Partner, Assegaf Hamzah & Partners
ahmad.assegaf@ahp.co.id

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