Wheelock Properties (Singapore) has upped the ante in Simon Cheong's bid to take SC Global Developments private. It announced yesterday that it had acquired 1.066 million SC Global shares from
the open market at about $1.81 per share, one cent higher than Mr Cheong's offer price. The acquisition takes Wheelock's stake in SC Global to about 16.09%.

Wheelock senior executive director Tan Bee Kim said in a statement: "In our assessment, the current share price represents a discount of some 40'50 per cent of RNAV (revalued net asset value), and we would be unable to buy property assets directly at anything like these prices."

However, some market watchers note that Wheelock's move to buy more SC Global shares reduces the counter's free 'oat  ' and move Mr Cheong closer towards his goal of taking the company private. Once the free 'oat falls below 10%, the counter is vulnerable to delisting.

Mr Cheong is making the offer through his investment holding company MYK Holdings Pte Ltd. Prior to the offer, he controlled 55.06 per cent of SC Global. As at 5pm yesterday, aggregate holdings of the offeror and parties acting in concert have risen to 60.74 per cent after he had acquired or agreed to acquire shares representing about 5.68 per cent of the company. Mr Cheong has said that delisting would allow SC Global greater 'exibility to manage and plan the business. Going private would relieve SC Global of public listing
costs and requirements.

Mr Cheong's offer price of $1.80 per share works out to a premium of 49.4 per cent over the last traded price (on Nov 30) prior to the announcement of the offer and a premium of 71.1 per cent over the
12'month volume weighted average price.

Given the turn of events, we are also more inclined to think that SC Global's privatization would be sped up, as Wheelock's increased shareholdings of SC Global will reduce its free 'oat.

Source: AmFraser