MARKETS & INVESTING, STOCKS | Staff Reporter, Singapore

Daily Briefing: Higher premiums may loom amidst SGXRegCo's new delisting rules; Indonesia to set up sea bridge with Singapore

And Vietnam-based KinderWorld International Group scraps its planned SGX IPO.

From Bloomberg:

Singapore’s move to shift the power on delistings in favor of minority shareholders means bidders will need to pay higher premiums to get deals done.

That’s according to analysts at United First Partners and RHB Securities after the Singapore exchange announced two changes to the rules on voluntary delistings. Analysts at both firms said the new guidelines will now make the delisting process more onerous and therefore lead to higher offer prices in comparison to the past.

“Exit offers must now be equal or more than the intrinsic value of the securities,” said Justin Tang, head of Asian research at United First. “Given that only independent shareholders are allowed to vote, there is a greater certainty of minorities being better able to determine the outcome of the vote,” he said.

Read more here.

From Bloomberg:

Indonesia plans to start building its longest sea bridge next year to connect two islands near Singapore and boost growth and trade with the neighboring hub.

The seven-kilometer bridge connecting Batam and Bintan will cost as much as $384.8m ($284m) and construction is set to take three to four years, the country’s cabinet secretariat said in a statement.

President Joko Widodo, who has secured his second term in office, is embarking on a more than $542b (US$400b) infrastructure push. The government wants to re-position Batam as an alternative shipping and manufacturing hub to Singapore with a potential to draw $81.3b ($60b) in new investment.

The ministry in charge of public works is preparing a feasibility study and analysing engineering designs, and is aiming to complete these by year-end, according to the statement.

Read more here.

From DealStreetAsia:

KinderWorld International Group, which operates schools in Southeast Asia, has shelved its plans to conduct an initial public offering (IPO) on the Singapore Exchange (SGX) Mainboard.

The Vietnam-headquartered company had lodged its preliminary prospectus on 27 June without specifying any details about the issue size, timing or pricing.

“Kinderworld International Group and its advisers are evaluating the current market conditions and geo-political climate, and have retimed its proposed initial public offering to better tap the Singapore capital markets at a more favourable time,” the company said in a statement.

It reiterated that its balance sheet is healthy with sufficient funds that can help the company grow in targeted markets.

Read more here.

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