The independent directors of Singaporean Nera Telecommunications (NeraTel) have recommended to minority shareholders to reject Northstar’s mandatory S$0.49 (US$0.4) a share offer for all outstanding shares.
The directors followed the recommendation of…
The independent directors of Singaporean Nera Telecommunications (NeraTel) have recommended to minority shareholders to reject Northstar’s mandatory S$0.49 (US$0.4) a share offer for all outstanding shares.
The directors followed the recommendation of its independent financial adviser, Deloitte, which had concluded that Northstar’s offer is “fair but not compelling”.
Among other things, Deloitte took into consideration that Northstar’s offer price represented a 6.6% discount to 1 month volume weighted average price (VWAP) and a 1.7% premium to the 3 month VWAP. “This compares unfavourably to the average and median premium of 35.5% and 31.1% for 1 month VWAP and 39.7% and 36.4% for 3 month VWAP respectively for takeovers in the last two year period preceding [Northstar’s offer for NeraTel],” Deloitte said.
In November, Indonesian PE firm The Northstar Group agreed to acquire a controlling 50.05% stake in NeraTel for S$88.8m (US$ 72.5m), from Norwegian power solutions provider Eltek.
In line with Singapore takeover and merger laws, Northstar had to make a mandatory offer for the remainder of the company.
Standard Chartered acts as financial adviser to Northstar in the transaction, while Rippledot Capital advises Eltek.
