Oversea-Chinese Banking Corp is now offering S$900 million (US$699.9 million) to buy the chunk of insurer Great Eastern that it does not already own, almost a year after failing to gain full control of the firm.
Under the conditional exit offer announced on Friday (Jun 6), OCBC is offering S$30.15 for the 6.28 per cent of the insurer’s stock that it does not own. This values Great Eastern at S$14.27 billion and paves the way for the insurer to be taken private by its owner.
In May 2024, OCBC offered S$25.60 apiece for the 11.56 per cent stake in Great Eastern. The new exit offer reflects a 17.8 per cent premium from the previous bid.
The final offer from Singapore’s second-largest bank would mark its fourth attempt to fully acquire Great Eastern, following three previous bids since 2004.
OCBC owns 93.72 per cent of the insurer, but that stake still falls short of the threshold needed to delist the company or launch a compulsory acquisition.
Two companies controlled by Lee Thor Seng and his sons – members of the founding family behind OCBC – own nearly 2 per cent of Great Eastern, making them the second-largest shareholders, according to the insurer’s annual report.
Wong Hong Sun and Wong Hong Yen hold about 1 per cent, while Palliser Capital, which previously criticised the latest takeover bid as unfair to shareholders, owns a 0.27 per cent stake, the report showed.
Trading in Great Eastern’s shares was suspended on Jul 15, 2024, after its free float fell below 10 per cent.
OCBC currently has a 93.72 per cent stake in Great Eastern. The offer, to go through, requires a minimum 75 per cent backing from minority shareholders.
If the delisting is not approved, shareholders would then be voting on a proposal to resume trading in the insurer’s shares.
If a situation arises where Great Eastern cannot get delisted, it will offer bonus shares to recommence on the Singapore Exchange.
