Great Eastern Aims to Delist Via OCBC’s Exit Offer

Great Eastern Aims to Delist Via OCBC’s Exit Offer

Singapore insurer Great Eastern is seeking to delist from the local exchange through an exit offer by parent group OCBC.

OCBC is backing a proposal by Greater Eastern to pay S$900 million ($700 million) for the 6.28 percent of shares in the insurer it does not own to delist, according to a statement. The offer values the remaining stake at S$30.15 per share.

Under the listing rules of the Singapore Exchange, issuers must ensure a free float of at least 10 percent of shares. As it was unable to meet this requirement, the trading of Greater Eastern’s shares has been suspended since 15 July 2024. The exchange has given the insurer an extension until June 8 to comply with the rules.

OCBC’s offer requires the owners of at least 75 percent of the shares to vote in favor of the proposal. If the delisting resolution is passed, Greater Eastern will be removed from the exchange and shareholders who accept the offer will be paid while those who do not will own unlisted shares.

Plan B

If the delisting resolution is not passed, Great Eastern will proceed to its alternative proposal of satisfying the free float requirement through its «1-for-1 bonus issue resolution» which comprises new ordinary shares that will be listed and carry voting rights alongside newly-created Class C Non-Voting Shares that will not be listed and have no voting rights.

Under this scenario, OCBC intends to vote in favor of the bonus issue resolution and opt to receive the Class C Non-Voting Shares which will dilute the Singapore lender’s shareholding of voting shares to 88.19 percent but retain a 93.72 percent stake of economic interest in the insurer.

«While we have never wavered in our strategic intention to delist Great Eastern, this offer is made to avail to GEH shareholders the opportunity to exit the stock after an 11-month suspension in share trading,» said OCBC CEO Helen Wong.

«We have carefully considered the decision. We are therefore making a fair and reasonable offer, to comply with listing rules, to support Great Eastern’s proposal to delist. At the same time, we are able to continue to protect the interests of our own shareholders as we realize our ambition of building an integrated financial services group that will lead the region’s wealth management industry.»