Accepted Sembcorp Marine Mandatory Conditional General Cash Offer

 

I received this document in my mailbox because Temasek has made a mandatory conditional general cash offer to acquire all the issued and paid-up ordinary shares in Sembcorp Marine.

This did not come at a surprise because Temasek's shareholdings in Sembcorp Marine increased from 42.6% to 46.6% after the recent rights issue.

This corporate action is in line with Rule 14.1 of the Takeover Code, where any entity controlling 30% to 50% of a company must make a mandatory general offer if it raises its interest by more than 1% within a period of 6 months.

I have shared earlier in My Strategy for Sembcorp Marine Rights on the various scenarios that could pan out for Sembcorp Marine and indeed, the potential mandatory offer by Temasek subsidiary, Startree even before the acquisition of/merger with Keppel O&M has really come into picture now.

This does not mean 100% guarantee that Temasek will acquire all shares of Sembcorp Marine because it must increase its shareholdings from 46.6% to at least 50% for our shares to be purchased by Startree if we accept the offer.

I believe this game needs tons of patience. In the short run, there are no sign of recovery for Sembcorp Marine. An investor in Sembcorp Marine can only bet on its long term and future prospects in renewable energy after merger with Keppel O&M in time to come. For the merged entity to reap decent profits through streamlining of operational efficiencies, it may take many years or even a decade.

As I only own a small quantity of Sembcorp Marine shares, I decided to play with my luck by accepting the offer in the SGX portal instead of mailing back the form, which has a decent chance to happen as certainly there will be many shareholders who decided to throw in the towel after years of extreme disappointment in this poorly managed company. 

Though I hope that this offer will lapse for me to continue ride on this roller coaster journey, I would not mind taking back some capital and resign to a great waste of time subscribing to the rights and then taking my money back. Should the offer materialise, I intend to use the recovered funds to buy 1 to 2 shares of Tesla to enjoy another more exciting roller coaster journey.

Here it goes.

Thanks for reading. As always, stay safe and remain strong.

With love & peace, 

Qiongster