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Big China deal here

In China, Commodities on 30/03/2016 at 10:20 am

Sinochem Plans to Create World’s Largest Listed Rubber Company here in S’pore. In the latest example of China’s hunt for global commodities assets, the state-owned Sinochem International made an offer to buy Halcyon Agri that valued the Singapore-based company at 450 million Singapore dollars, or about US$328.4 million. NYT Dealbook

Reuters reports

Sinochem International Corp said late Sunday (March 27) that it has offered to acquire a 30.07 per cent stake in Halcyon Agri for S$0.75 a share. The all-cash deal will be worth at least S$240 million.

 Sinochem International will also make a mandatory general offer at the same price to all Halcyon shareholders.

Subsequently, Halcyon will make an offer for Singapore-based natural rubber producer GMG Global Ltd — in which Sinochem International has a 51 per cent stake — at an exchange ratio of 0.9333 Halcyon share for each GMG Global share.

Halcyon Agri will also buy Sinochem’s natural rubber processing assets in China and Malaysia and trading businesses, the companies said in a joint statement on Monday.

After the transactions are complete, Sinochem will become the majority shareholder of Halcyon Agri, which will be the holding company of the expanded group.

The deals are expected to be completed by the end of the third quarter of 2016.

The companies said the deal would create the world’s largest natural rubber supply chain manager with combined revenue exceeding US$2.3 billion (S$3.2 billion).

The companies said in January that they had been in talks over the potential deal.

Trading was halted in shares of Halcyon, which has a market value of US$320 million, and in GMG, valued at US$345 million.

Halcyon, which requested on Monday for the trading halt to lifted, last traded at S$0.73, while GMG was at S$0.615.

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