TIH cites OUE and possible control change in response to SGX

The bourse questioned Tuesday's unusual price movements.

Following an increase of over 16% in TIH's share price, the Singapore Exchange Securities Trading Limited posted the query to get the company's explanation.

In response, the company cited the correlation between the share prices of OUE and TIH. The reply also revealed that there are ongoing discussions on a potential transaction involving a change of control of TIH.

Here's part of TIH's response:

The Company notes that OUE Limited forms a significant portion of our investment portfolio. When calculated, the share prices of the Company and OUE Limited have a correlation factor of 0.843 based on the last price of the Company and OUE Limited in the last 5 years.

The correlation between the share prices of OUE Limited and the Company might offer a possible explanation for the trading, as the Company expects that an increase in the share price of OUE Limited would contribute significantly to the value of our shares.

The Company is of the opinion that the recent strong performance of the share price of OUE Limited might offer a possible explanation for the trading on 21 March 2017. In addition, the Company would also like to point out that our investment in OUE Limited as a percentage of our investment portfolio has grown over time, strengthening and enhancing the correlation.

The Company is also aware that there are ongoing discussions on a potential transaction involving a change of control of the Company. There is no assurance that such discussions will result in any transaction.

As far as the Company is aware, the structure of such transaction, if entered into, is subject to regulatory approval which is in the process of being applied for and the price at which such transaction, if entered into, will likely be lower than the closing price per share in the Company of S$0.695/share on 21 March 2017.