On April 7, the Securities Industry Council (SIC) found that Sam Goi Seng Hui, who is PSC Corporation's (SGX:DM0
) chairman, was in breach of Rule 14.1(a) of the Singapore Code of Take-overs and Mergers.
According to Rule 14.1(a), any person who acquires shares which (taken together with shares held or acquired by persons acting in concert with him) carry 30% or more of the voting rights, such person and persons acting in concert with him must extend offers immediately to other shareholders.
Furthermore, paragraph one of the Share Buy-Back Guidance Note of the Code states that when a company conducts share buyback transactions, any resulting percentage increase of shares will be treated as an acquisition for the purpose of Rule 14 of the Code.
Between May 2, 2023 and Oct 16, 2023, PSC Corporation undertook share buyback transactions under the share buyback mandate and as a result, Goi’s shareholding has increased from 29.97% to 30.22%.
With shareholding crossed the 30% threshold, Goi had breached a condition for the Share BuyBack Exemption and therefore he incurred a bid obligation on the initial purchase date. However, he did not make a general offer for PSC Corporation. Accordingly, he had breached Rule 14.1(a).
According to SIC’s statement, the breach was only discovered during the Council’s review of an application submitted by Goi back in last February, pertaining to a potential offer for PSC Corporation, which was unrelated to the breach.
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In the statement, Goi states that he did not seek professional advice to confirm his understanding before making the purchases of shares in breach of the share buy-back exemption.
In terms of remedial actions, notwithstanding that the bid obligation was incurred at the highest purchase price of 36 cents per share, Goi decided to use the highest offer price of 40 cents per share to discharge the mandatory offer obligation incurred on Dec 4, 2023.
Taking into account the foregoing, as well as Goi’s cooperation during SIC’s review of the breach and in implementing the remedial actions, SIC decides to take no further action against Goi.
