Cosco hits 90% acquisition threshold in takeover bid, plans to delist Cogent

Chinese shipping company Cosco Shipping International (Singapore) has hit the 90 per cent compulsory acquisition mark for its S$1.02-a-share cash offer for Cogent Holdings.

As at 5pm on Dec 21, Cosco has received valid acceptances representing around 5.68 per cent of the total number of Cogent shares, the company said.

Cosco had previously received irrevocable undertakings by four Cogent shareholders, who collectively hold 84.33 per cent of the total number of Cogent's shares.

Since this brings Cosco's total holdings to 90.01 per cent, Cosco said that it will pursue a delisting of Cogent from the Singapore Exchange.

The four undertaking shareholders are Cogent's executive chairman Tan Yeow Khoon, his wife Ng Poh Choo, managing director Tan Yeow Lam, and executive director and chief executive Benson Tan Min Cheow, with all four agreeing to accept the offer on or before Jan 3, 2018.

Cosco's offer price represents some 3 1/2 times Cogent's net tangible asset per share of 29.8 Singapore cents as at end-June 2017.

Upon Cogent's delisting, Cosco says it intends for Cogent to continue with its existing business activities, and does not intend to introduce any major changes to Cogent's existing businesses, re-deploy any of Cogent's major fixed assets, or discontinue the employment of any Cogent employees, other than in the ordinary course of business.

The proposed deal is deemed an interested-party transaction as Cosco's controlling shareholder, China Ocean Shipping (Group) Company, is wholly owned by shipping giant China Cosco.

Cosco's financial adviser for the deal, Bank of China, will extend a S$350 million loan facility to part fund the takeover.

Wong Kai Yi

22 December 2017