3HA Capital has revised its offer price for the share takeover of Cosmosteel to 25 cents in cash, up from the 20 cents previously announced, after the independent financial advisor (IFA) deemed the offer “not fair”.
On May 15, a group of investors including a wholly-owned subsidiary of Cosmosteel Holdings' controlling shareholder Hanwa Co offered 20 cents per share for the mainboard-listed piping steel supplier.
The offer is made via an entity called 3HA Capital, whose shareholders include Hanwa Singapore, a subsidiary of Hanwa Co, a Tokyo-listed trader of steel and other materials which now owns 31.61% of Cosmosteel. Other parties in the offeror include HHH Group, Bursa-listed AYS Ventures Bhd and Thor Capital.
Asian Corporate Advisors, the IFA appointed by the offeror, said that the 20 cents per share offer is “not fair” because the company’s financial position remains “strong and healthy”, among other reasons.
The final offer price of 25 cents represents an increase of 5 cents, or 25% over the initial offer price. The offeror says that this decision follows a review from the IFA issued to independent directors, which provided a range of values for the shares based on established valuation methodologies. The final offer price is positioned around the mid-point of that range and reflects a considered approach informed by independent financial analysis.
3HA Capital adds that since the announcement of the offer, the shares have not traded at or above the final offer price, notwithstanding increased trading activity and on-market purchases by parties associated with the company.
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Shares in Cosmosteel closed 0.5 cents higher or 2.273% up at 22.5 cents on June 23.
