F&N board to resign, give Charoen "free hand"

F&N board to resign, give Charoen "free hand"
Posted: 29 January 2013 2033 hrs
    
SINGAPORE - Fraser & Neave said on Tuesday that all of its board members, including chairman Lee Hsien Yang, will resign from the company next week, paving the way for Thai billionaire Charoen Sirivadhanabhakdi, the largest shareholder, to have a greater say in the Singapore company's future.

The nine board members decided to resign to allow Mr Charoen's TCC Assets to have a "free hand to chart a new direction" for Fraser & Neave, a Singapore property and soft drinks conglomerate, Mr Lee told shareholders at the company's annual general meeting.

Mr Charoen, who holds a 46% stake in Fraser & Neave, had raised his offer to S$9.55 a share for the company's remaining shares - 7.5 percent higher than his previous offer of S$8.88. The increase was aimed at fending off a rival bid from a group led by Stephen Riady's Singapore-listed property firm Overseas Union Enterprise. Mr Charoen's offer closes on Monday.

The Overseas Union group decided not to raise its S$9.08-per-share offer, saying such a move was no longer attractive after recent measures taken by the Singapore government to cool the city-state's property market.

Fraser & Neave said the board will resign whether or not Mr Charoen acquires more than 50% of the company before the offer closes, in which case the offer would become unconditional.

"As clearly the largest shareholder of the company today, and probably a controlling shareholder of the company in a few days' time, it's not inappropriate for them to have that full flexibility and to want a clean slate, where they would want to move things forward," said Mr Lee.

The AGM started with shareholders lobbing wide-ranging questions about the takeover before annual financial matters of the company were addressed.

Some questioned how TCC Assets managed to secure an additional 90 million F&N shares on the eve of the auction, as most shareholders would have held on to their shares until the auction ended.

"The 90 million shares were a very sizeable block. TCC's broker must be very effective in persuading shareholders to sell on the eve of the auction," one of the shareholders said.

Several of them expressed disappointment that an auction called by the Securities Industry Council (SIC) failed to get into full swing when the Overseas Union group bowed out on January 21, the first day of the sale.

The auction was triggered because neither bidder declared a final offer by a January 20 deadline set by the Singapore securities watchdog.

The SIC had stepped in after Mr Charoen extended the deadline of his previous offer seven times and the Overseas Union group twice, testing the patience of investors.

"I was disappointed too that OUE Baytown, after extending on numerous occasions presumably with an interest to bid in due course, chose not to bid when the auction process was initiated," Mr Lee said.

But Mr Lee said Mr Charoen had raised his offer before the auction, creating a "clear gap" with the Overseas Union group's S$9.08-per-share bid.

When asked if he was satisfied with the outcome, Mr Lee said: "It would have been good to get a better outcome for shareholders but it's a good outcome."

Separately, Japanese brewer Kirin Holdings, Fraser & Neave's second-largest shareholder with a 14.8% stake, said it will decide whether to sell its stake to Mr Charoen by Monday.

- CNA/ir

- wong chee tat :)