StarHub exits Ensign rights deal in $121m cash transaction

The deal involves the termination of rights over 77.587 million Ensign InfoSecurity shares, or 16.81% of total issued shares.

StarHub has agreed with Temasek-linked Ensign Technologies Pte. Ltd. (ETPL) to end an assigned rights arrangement related to its investment in Ensign InfoSecurity for total cash proceeds of $121m.

In a press release, the company said the arrangement covers part of StarHub’s economic and equity interest in Ensign InfoSecurity and stems from the joint venture structure set up in 2018.

The company said the move allows it to partly monetise its investment whilst maintaining a strategic stake in the cybersecurity firm.

“As part of this, StarHub expects to recognise a fair value gain of over $200m from the termination of the Aggregate Assigned Rights and the remeasurement of its remaining 38.92% equity interest in Ensign upon recognising Ensign as an associated company,” the company announced.

The deal involves the termination of rights over 77.587 million Ensign InfoSecurity shares, or 16.81% of total issued shares.

The arrangement was first created when the joint venture was formed in 2018 and was later extended in 2023 before the latest agreement to end it.

The termination will take effect on 15 April with ETPL to pay the consideration within 15 business days after completion amounting to $115.03m under the agreement.

After completion, StarHub will hold a 38.92% stake in Ensign InfoSecurity, which will be treated as an associated company.

The rationale for the proposed termination is to partially monetise the company’s investment in JVCo, whilst retaining strategic participation, allowing the company to redeploy capital towards other strategic and core business investments.

The Audit Committee said the deal is on normal commercial terms and is not prejudicial to the company or minority shareholders.

Temasek is deemed a controlling shareholder of StarHub under SGX rules, and ETPL is an indirect wholly-owned subsidiary of Temasek, the filing said.