SOUTH Korean conglomerate Hanwha Group on Monday raised its offer for the remaining stake it does not already own in Singapore’s Dyna-Mac, valuing the offshore oil and gas contractor at S$790.6 million ($605.41 million).
The improved offer of S$0.67 per share represents a 35.4 percent premium to Dyna-Mac’s last traded price on September 10, before Hanwha’s earlier offer of S$0.60 per share was disclosed.
Shares of Dyna-Mac last closed at S$0.65, having climbed 94 percent year-to-date, LSEG data showed before the announcement.
Hanwha said in a statement that the improved offer is “final” and it “has no intention to increase or revise” it.
On Tuesday, shares of Dyna-Mac rose as much as 1.5 percent to S$0.66.
Maybank Investment’s head of small-mid caps Jarick Seet said in a note to clients on October 14 Hanwha’s latest offer is “fair” and added “the main aim of the offer is not to delist the company but to have a controlling stake of more than 50 percent.”
The offer on Monday follows a statement on October 10 from Dyna-Mac’s single largest shareholder, the estate of founder Desmond Lim, that it did not find Hanwha’s S$0.60 offer “compelling” as it did not adequately reflect the company’s value and growth potential.
Lim’s estate holds a 28.36 percent stake in Dyna-Mac, while Hanhwa’s units, Hanhwa Aerospace and Hanwha Ocean, own a combined stake of around 24 percent, LSEG data showed.
Hanwha said on Monday that the latest final offer price was reflective of the acquisition’s intrinsic value, and it “may consider other strategic options available to it should the offer not succeed at this juncture.”
In September, Hanwha halted talks to acquire Austal, five months after the Australian shipbuilder said it had rejected an AU$1.02 billion ($686.36 million) takeover offer because it was unlikely to be approved by Australian and US regulators due to the sensitivity of its operations.
The acquisition of Dyna-Mac will provide Hanwha access to the company’s two oil and gas manufacturing facilities in Singapore and its floating production storage and offloading vessels.
Hanwha said it took into consideration the Singaporean firm’s financial performance as well as the potential benefits of its recent Exterran Offshore acquisition to conclude its offer price.
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