$1.18b offer for SMRT
Temasek Holdings has made an offer to buy over and take SMRT private at $1.68 per share.
If successful, it means the rail and bus operator will be delisted from the Singapore bourse.
The offer price is a premium over the company's last share price of $1.545, and it will see the Singapore investment firm forking out about $1.18 billion for the rest of the company that it does not own.
Temasek currently owns 54 per cent of SMRT, which is valued at close to $2.4 billion, based on last Friday's price.
The proposed acquisition for all the shares in SMRT not already owned by Temasek will be effected by way of a scheme of arrangement in accordance with the Singapore Companies Act and The Singapore Code on Take-overs and Mergers, said Temasek and SMRT in a joint statement yesterday.
The offer follows SMRT's announcement on July 15 that it would be selling its operating assets to the Land Transport Authority.
"Privatisation will provide SMRT with greater flexibility to focus on its primary role of delivering safe and high quality rail service, without short-term pressures of being a listed company, in the midst of its transition to a new regulatory framework under the New Rail Financing Framework," said SMRT and Temasek.
However, "there remain significant business risks and challenges, which are beyond the control of SMRT".
SMRT is expected to face challenges - even under the new framework - with costs and uncertainties associated with an ageing and expanded network, the statement added.
For Temasek's bid to succeed, a majority of shareholders present at a meeting have to vote for it. These shareholders will have to hold at least 75 per cent of the value of SMRT shares held by all shareholders present at the meeting.