DBS Divests Holdings In Associated Company Fujitec
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Will Receive S$35.1 Million For Entire 26.3% Stake
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Transaction is Latest of DBS' Initiatives To Divest Non-Core Businesses
SINGAPORE, May 9, 2003 - DBS Group Holdings Ltd (DBS) completed today a two-step transaction to divest its entire 26.3% stake in Fujitec Singapore Corporation Ltd (Fujitec) for a total cash consideration of S$35.1 million.
The total amount of $35.1 million or S$13.50 per share paid to DBS Bank for the two-step transaction is equivalent to Fujitec's net book value based on its audited accounts for the financial year ended December 31, 2002.
The share sale by DBS Bank will not have a material impact on DBS Group's operations as the investment in Fujitec has been equity accounted for at the Group level.
Under the first step of the transaction, Fujitec completed a capital reduction exercise by cancelling at par 1,800,000 issued and fully paid-up ordinary shares of S$1.00 each held by DBS Bank, a wholly-owned subsidiary of DBS, and returning the sum of S$1.8 million to the Bank.
In the final part of the transaction, Fujitec entered into a share buy-back agreement with DBS Bank in which Fujitec agreed to acquire the remaining 800,000 shares, or 9.9% of the issued ordinary share capital, held by DBS Bank for S$33.3 million.
The sale of the Fujitec stake is the latest of DBS' initiatives since 1999 to divest its non-core assets, and is consistent with the directive by the Monetary Authority of Singapore (MAS) for local banks to restructure and divest their non-financial businesses within three years from July 2001. DBS has, since 1999, divested over S$2 billion of non-core assets, including both properties as well as equity investments. Major transactions included the sale of DBS' investments in Capitaland Commercial Limited (formerly known as DBS Land Limited), Singapore Petroleum Company Limited, AVIVA Ltd (formerly known as The Insurance Corporation of Singapore Limited), Keppel Capital Holdings Ltd and, more recently, NatSteel Ltd.
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