CDL to buy back 10% of preference shares for $25.8 million via off-market purchase

SINGAPORE – Property giant City Developments Limited (CDL) is shelling out $25.8 million to buy back 33.1 million of its preference shares, or about 10 per cent of its 330.9 million preference shares, under its share purchase mandate approved by shareholders in April.

On Nov 27, CDL said this represents 100 per cent of the maximum buyback amount under its off-market equal access offer announced earlier this month.

They will be purchased on the Singapore Exchange on Dec 1 at $0.78 apiece.

The offer, which was launched on Nov 9, closed at 5.30 pm on Nov 23.

All preference shares purchased or acquired by CDL in connection with the offer will thereafter be cancelled.

As these shares do not carry general voting rights, there will be no implications arising from Singapore’s takeover and mergers code.

In its Nov 2 filing announcing the deal, the group said its off-market equal access offer would provide its preference shareholders with a “cash exit opportunity to tender their preference shares for acceptance by the company and monetise such preference shares”.

It would also allow the company to exercise greater control over its share capital structure, said CDL, which noted that the trading volume of such shares had been “generally low”.

Shares of CDL were trading $0.04 or 0.64 per cent lower at $6.17 as at 11.50 am on Nov 27. THE BUSINESS TIMES