United Engineers Ltd. (UEM), a Singapore group with investments from real estate to engineering, offered to buy WBL Corp., valuing the company at S$1.1 billion ($890 million) and topping an earlier bid by Straits Trading Co. (STRTR)
United Engineers will offer S$4 a share in cash for the remaining 61.7 percent of WBL that the company and its partners don’t already own, as well as WBL’s convertible bonds, it said today in a statement to the Singapore Exchange. The proposal is higher than an offer by Straits Trading, which bid S$3.41 a share in cash or 1.07 of new shares.
Oversea-Chinese Banking Corp. (OCBC), Singapore’s second-biggest bank by assets, and its partners are working with United Engineers on its bid, according to the statement. OCBC and its partners control 38.3 percent of WBL and S$12.8 million in bonds convertible into a 1.99 percent stake in WBL. OCBC said last month it was reviewing options for its stake as the Straits Trading offer was below WBL’s net asset value, the Straits Times said, citing Chief Financial Officer Darren Tan.
“UE has been exploring opportunities to make a substantial acquisition that will be transformational in nature,” Jackson Yap, managing director and chief executive officer at United Engineers, said in the statement. “WBL will give us the scale and scope, as well as the geographic diversification, to achieve our strategic ambition.”
Straits Trading said in a statement on Jan. 16 that it would hold 44.55 percent of WBL and that shareholders approved making a cash-or-share offer for rest of the company.
United Engineers has fallen 1.2 percent this year in Singapore trading, compared with the 3.5 percent gain in the benchmark Straits Times Index. WBL (WBL) increased 5.3 percent in the same period and last traded at S$4.20 yesterday before being halted for the announcement.
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