Eu Yan Sang cites valuation slump, profit woes as motives behind delisting bid

A consortium is offering $0.60 cents per share.

A consortium made up of Tower Capital, Temasek and some members of the controlling Eu family have launched a privatisation offer for Mainboard-listed traditional chinese medicine retailer Eu Yan Sang.

The consortium is offering $0.60 per share, valuing the company at $269 million. The offer price is final.

As of Monday, May 16, the consortium has received irrevocable acceptances representing approximately 63.2% of the existing total shares fro several Eu Yan Sang family shareholders, Aberdeen Asset Management and First State Investment Management.

The offer price represents a premium of approximately 17% and 25% to the volume weighted average price per share for the corresponding three-month and six-month periods up to and including the last full trading day before the offer was announced.

"Considering the low trading liquidity of the Shares, the Offer provides shareholders with more certainty, through an exit opportunity to realise their investment at a premium. The consortium’s acquisition of the Company will allow the new investors to partner with the participating Eu family shareholders in their efforts to invigorate the Company’s businesses,” said Danny Koh of Tower Capital.

The offer is conditional once the consortium acquires at least 50% of the voting rights attributable to the maximum potential issued share capital of the company, and receives a
statement of no objections from the Foreign Investment Review Board of Australia.