An independent assessor has thrown a spanner in the works in UOL Group’s takeover bid for United Industrial Corp.
After evaluating the offer, Dutch bank ING said UOL’s offer price for UIC shares is “not fair”.
On January 14, UOL had proposed to pay S$1.20 for each UIC share. This represents a nine per cent premium over UIC’s last traded price prior to the announcement.
The bid for UIC revived long-time rivalries between United Overseas Bank Chairman, Wee Cho Yaw, and Philippine typhoon, John Gokongwei.
Mr Wee is chairman of UIC, while Mr Gokongwei is its largest shareholder.
In 2005, when Mr Gokongwei tried to buy out UIC, Mr Wee was among the shareholders who rejected the offer.
In a circular to shareholders on Wednesday, ING said that shareholders with a long-term view of their investment in UIC should reject UOL’s offer.
However, it added that shareholders who wish to realise their holdings in the near term may wish to sell them on the open market, if the price is equal or higher than S$1.20 apiece.
UOL had mounted the takeover bid after its shareholding in UIC crossed the 30 per cent mark. Under listing rules, this meant it had to make a general offer for the remaining shares.
Source : Channel NewsAsia – 18 Feb 2009