OneApex (formerly: Chew's Group)

[ghchua]

Any1 can share why they offering below trading price?

Hi Terry,

Please refer to one of the earlier post in this topic on the term sheet for the proposed sale of shares by controlling shareholder of Chew's Group to the offeror. One of the condition is a payment of dividend not exceeding S$8.5 million, which translates to around 10cts per share. Please also refer to post #62 of my post in this topic, which I also detailed the computation.

[hungting]

The interesting part of the latest announcement is the “Retained Cash” of $13.5 mil as a pre-condition. Does it mean they are prosposing to pay $0.159 instead of $0.10 prior to the offer?

[ghchua]

The interesting part of the latest announcement is the “Retained Cash” of $13.5 mil as a pre-condition. Does it mean they are prosposing to pay $0.159 instead of $0.10 prior to the offer?

The retained cash as a pre-condition is inserted to protect the buyer, just in case the company dividend out too much money before the launch of the cash offer. There is no indication that the buyer is going to dividend out all the retained cash in the company after the close of the cash offer, so don't bet on that.

What we can bet on though, is that Chew's Group should have around $20 mil plus in cash currently and with retained cash of $13.5 mil as pre-condition, the company should be able to pay a dividend not exceeding S$8.5 million, which translates to around 10cts per share (as detailed in the termsheet earlier) before the launch of the cash offer by the buyer.

[kikababoo]

The interesting part of the latest announcement is the “Retained Cash” of $13.5 mil as a pre-condition. Does it mean they are prosposing to pay $0.159 instead of $0.10 prior to the offer?

The retained cash as a pre-condition is inserted to protect the buyer, just in case the company dividend out too much money before the launch of the cash offer. There is no indication that the buyer is going to dividend out all the retained cash in the company after the close of the cash offer, so don't bet on that.

What we can bet on though, is that Chew's Group should have around $20 mil plus in cash currently and with retained cash of $13.5 mil as pre-condition, the company should be able to pay a dividend not exceeding S$8.5 million, which translates to around 10cts per share (as detailed in the termsheet earlier) before the launch of the cash offer by the buyer.

can i ask where do people get the idea that there's at least $20mil plus in cash in the company currently?

[hungting]

The "Retained Cash" pre-condition is imposed by Fenghe the seller and not the buyer for your information. So it was not to protect the buyer.

[ghchua]

can i ask where do people get the idea that there's at least $20mil plus in cash in the company currently?

You can take their latest half year financial year result as reference.
http://infopub.sgx.com/FileOpen/CGL_FY20...eID=504360

You can use the cash level of $48mil at that point in time and then add on asset held for sale of around $19mil. Deducting liabilities associated with asset held for sale of around $11mil, you should have around $56mil. Minus off payables in balance sheet of around $3mil will leave you with around $53mil.

After half year result balance sheet date, they have paid out a special dividend of 35cts per share, which works out to around $29.5mil. So, what remains should be around $53mil minus $29.5mil = $23.4mil thereabouts.

Hope that the above clarifies.

[hungting]

Company halted to clarify the dividend payout prior to conditonal GO ?

[ghchua]

Company halted to clarify the dividend payout prior to conditonal GO ?

http://infopub.sgx.com/Apps?A=COW_CorpAn...vidend.pdf
 
Basically, what they are saying tally with our discussion here. As long as they maintain not less than $13.5 million in cash, they can freely declare any dividend amount before the GO. However, they haven't decide the amount.

Based on my calculations above, I think a dividend amount of around 10 cts per share is possible before the GO as they should have more than $20 million in cash currently.

Let's wait and see.

[hungting]

Cash Dividend of $0.10 to be paid. Book closure date 04-Oct 2018 Last cum date 01 Oct 2018.
Way paved for the Mandatory Unconditional Offer after book clsoure?

[ghchua]

Cash Dividend of $0.10 to be paid. Book closure date 04-Oct 2018 Last cum date 01 Oct 2018.
Way paved for the Mandatory Unconditional Offer after book clsoure?

Oh yes. This should be the final dividend payout before the offer is being launched.