THE PROPOSED ACQUISITION OF SHARES IN THE CAPITAL OF UNITED INDUSTRIAL CORPORATION LIMITED

Transcription

1 (Incorporated in Singapore) (Company Registration No C) THE PROPOSED ACQUISITION OF SHARES IN THE CAPITAL OF UNITED INDUSTRIAL CORPORATION LIMITED 1. INTRODUCTION UOL Group Limited ( UOL ) wishes to announce that it has today entered into an option agreement (the Option Agreement ) with Haw Par Corporation Limited ( Haw Par and together with UOL, the Parties ), pursuant to which Haw Par has granted UOL a call option (the Call Option ) over 60,000,000 ordinary shares (the UIC Shares ) in the capital of United Industrial Corporation Limited ( UIC and such UIC Shares, the UIC Sale Shares ) held by Straits Maritime Leasing Private Limited ( Straits Maritime ), a wholly-owned subsidiary of Haw Par, and (ii) UOL has granted Haw Par a put option (the Put Option ) over the UIC Sale Shares. 2. PRINCIPAL TERMS OF THE OPTION AGREEMENT 2.1 Call Option and Put Option Under the terms of the Option Agreement: pursuant to the Call Option, UOL has the right to require Haw Par to procure Straits Maritime to sell to UOL (or its wholly-owned nominee) all (and not some only) of the UIC Sale Shares, on the terms and subject to the conditions in the Option Agreement; and pursuant to the Put Option, Haw Par has the right to require UOL (or its wholly-owned nominee) to purchase from Straits Maritime all (and not some only) of the UIC Sale Shares, on the terms and subject to the conditions in the Option Agreement, (the sale and purchase of the UIC Sale Shares, being the Proposed Transaction ). 2.2 UIC Sale Shares The number of UIC Sale Shares shall be 60,000,000 UIC Shares held by Straits Maritime. 2.3 Consideration Shares In consideration of the sale and purchase of the UIC Sale Shares, UOL shall allot and issue 27,272,727 new ordinary shares in the capital of UOL (the Consideration Shares ) to Haw Par (or its wholly-owned nominee) (the UOL Share Issuance ), based on an exchange ratio of 2.20 UIC Sale Shares per Consideration Share (the Exchange Ratio ), rounded down to the nearest Consideration Share. 1

2 2.4 Conditions to Exercise The exercise of the Call Option by UOL and the exercise of the Put Option by Haw Par shall, in each case, be conditional upon the satisfaction of the following conditions (collectively, the Conditions ): (ii) (iii) the approval of the shareholders of Haw Par (excluding UOL and its associates) for the sale of the UIC Sale Shares to UOL upon the terms and subject to the conditions set out in the Option Agreement being obtained by Haw Par at an extraordinary general meeting of its shareholders, in accordance with the requirements of the Listing Manual (the Listing Manual ) of the Singapore Exchange Securities Trading Limited (the SGX- ST ); the approval of the independent shareholders of UOL being obtained by UOL at an extraordinary general meeting of its shareholders for the waiver granted by the Securities Industry Council of Singapore (the SIC ) to UOL waiving the obligation under Rule 14 of the Singapore Code on Take-overs and Mergers (the Code ) for Haw Par (or its nominee) to make a general offer for UOL by reason of the UOL Share Issuance, as further described in paragraph 7 (the Whitewash Resolution ); and the approval of the SGX-ST for the listing, quotation and trading of the Consideration Shares on the Main Board of the SGX-ST (the Listing Approval ) being obtained on terms reasonably satisfactory to the Parties, and the Listing Approval remaining in full force and effect at completion of the Proposed Transaction in accordance with the terms of the Option Agreement (the Completion ) and, if the Listing Approval is subject to any conditions which are required to be fulfilled on or prior to Completion, such conditions being so fulfilled The Conditions are not capable of being waived by either Party or both Parties. The Conditions shall be satisfied by 31 October 2017 (or such other date as the Parties may agree in writing) (the Long-Stop Date ). If any of the Conditions is not satisfied by the Long-Stop Date, the Option Agreement will ipso facto cease and determine and neither Party will have any claim against the other Party for costs, damages, compensation or otherwise. 3. INFORMATION ON UIC AND HAW PAR 3.1 Information on UIC UIC was incorporated in Singapore in 1963 as a private company and was listed as a public company in UIC s core business is property development and investment. With its acquisition of the majority equity of Singapore Land Limited, a well-established property company, in 1990, UIC and its subsidiaries (collectively, the UIC Group ) became a major real estate developer with a portfolio of 2.5 million square feet of office space and 1 million square feet of retail premise in Singapore. 2

3 The UIC Group s property portfolio includes some of Singapore s best known commercial and retail landmarks as well as residential projects in prime and suburban areas. Overseas investments include properties in Shanghai, Beijing and Tianjin, the People s Republic of China and London, the United Kingdom. The directors of UIC as at the date of this Announcement are Dr. Wee Cho Yaw, Dr. John Gokongwei, Jr., Mr. Lim Hock San, Mr. James L. Go, Mr. Gwee Lian Kheng, Mr. Hwang Soo Jin, Mr. Alvin Yeo Khirn Hai, Mr. Yang Soo Suan, Mr. Wee Ee Lim, Mr. Lance Yu Gokongwei and Mr. Antonio L. Go. As at the date of this Announcement: UOL and its subsidiaries (collectively, the UOL Group ) has an interest in 634,680,500 UIC Shares, representing approximately per cent. of the total number of UIC Shares; and (ii) Haw Par has an interest in 69,571,883 UIC Shares, representing approximately 4.90 per cent. of the total number of UIC Shares. 3.2 Information on Haw Par Haw Par was incorporated in Singapore in 1969 and was listed on the SGX-ST in The principal activities of the Haw Par group (comprising Haw Par and its subsidiaries) are the manufacturing, marketing and trading of healthcare products, the provision of leisurerelated goods and services, and investment in properties and securities. The directors of Haw Par as at the date of this Announcement are Dr. Wee Cho Yaw, Mr. Wee Ee-chao, Mr. Wee Ee Lim, Mr. Sat Pal Khattar, Mr. Hwang Soo Jin, Dr. Lee Suan Yew, Dr. Chew Kia Ngee, Mr. Peter Sim Swee Yam, Mr. Gn Hiang Meng and Mr. Han Ah Kuan. As at the date of this Announcement, the UOL Group has an aggregate direct and indirect interest in 2,960,965 ordinary shares in the capital of Haw Par ( Haw Par Shares ), representing approximately per cent. of the total number of Haw Par Shares. 1 Unless otherwise stated in this Announcement, all references in this Announcement to the percentage shareholding in the issued share capital of UIC are based on a total of 1,419,404,412 UIC Shares (excluding any new UIC Shares to be issued pursuant to the scrip dividend scheme of UIC which will apply to the final dividend recommended by the board of directors of UIC in respect of the financial year ended 31 December 2016) as at the date of this Announcement. 2 Unless otherwise stated in this Announcement, all references in this Announcement to the percentage shareholding in the issued share capital of Haw Par are based on a total of 219,959,173 Haw Par Shares as at the date of this Announcement. 3

4 4. RATIONALE FOR THE PROPOSED TRANSACTION 4.1 Acquisition of Significant Minority Interest The Proposed Transaction would enable UOL to acquire a significant minority interest in UIC, representing approximately 4.23 per cent. of the total number of UIC Shares, which would otherwise not be readily available, given the lack of trading liquidity in UIC Shares and the current shareholding structure of UIC which comprises a free float of only approximately 13 per cent. This is in line with UOL s objective of consolidating its interest in UIC, with a view to achieving statutory control 3 of UIC in the future. At the same time, the Proposed Transaction immediately provides the UOL Group with an opportunity to significantly increase its ownership interest in UIC which, given the low liquidity in UIC Shares in the open market, would otherwise require substantial time and effort to accumulate by way of on-market purchases. 4.2 Waiver of Mandatory General Offer Obligation On Completion, the UOL Group s shareholding interest in UIC will increase from approximately per cent. to approximately per cent. Based on UOL s consultation with the SIC in connection with the Proposed Transaction, the SIC has waived the UOL Group s obligation to make a mandatory general offer for UIC as a result of the acquisition of the UIC Sale Shares pursuant to the Proposed Transaction. The SIC had indicated during such consultation that if the UOL Group increases its shareholding in UIC to more than 49 per cent. as a result of the UOL Group acquiring UIC Shares from its concert parties (which concert parties would include Haw Par and its subsidiaries) and not from third parties, the UOL Group would be required to make a mandatory general offer for UIC. Accordingly, the Option Agreement relates only to the sale and purchase of 60,000,000 UIC Shares which would result in the UOL Group holding in aggregate per cent. of the total number of UIC Shares at the time of Completion, and does not relate to all of the UIC Shares in which Haw Par has an interest as UOL does not intend to trigger a mandatory general offer for UIC. 4.3 Benefits to UOL Shareholders The Proposed Transaction will be beneficial to UOL Shareholders for the following reasons: Non-cash transaction As the aggregate consideration payable by UOL for the purchase of the UIC Sale Shares will be fully satisfied by an issue of new ordinary shares in the capital of UOL ( UOL Shares ) pursuant to the UOL Share Issuance, it will conserve UOL s internal cash reserves and provide UOL with the financial flexibility to pursue future growth opportunities. 3 Under the Code, statutory control means a holding, or aggregate holdings, of shares carrying more than 50 per cent. of the voting rights of a company. 4

5 4.3.2 Greater diversification An increased ownership interest in UIC will indirectly increase the UOL Group s access to UIC s commercial property portfolio and, in particular, UIC s office properties in the Singapore Central Business District. Taken together, the UOL Group and the UIC Group will have highly complementary property interests across the residential, office, retail and hospitality segments, and the geographic footprint of both groups property portfolios is well balanced across Singapore and other markets, including the People s Republic of China and the United Kingdom Greater strategic alignment and efficient allocation of resources An increased ownership interest in UIC will eventually allow the UOL Group to exercise greater control over the deployment of UIC s resources, thereby enhancing the ability of UOL and UIC to leverage on the benefits of each other s track records, market positions, organisational capabilities, management resources and human capital, business strategies, and institutional knowledge. As two of the leading property players in Singapore, the Proposed Transaction would enable UOL and UIC to further align their respective strategic interests and enhance their ability to collaborate on joint acquisitions of land banks and office and retail investments in Singapore and elsewhere Ability to drive operational improvements An increased ownership interest in UIC may allow both UOL and UIC to create shareholder value by leveraging their combined scale and drawing upon each other s best practices to implement certain process and efficiency improvement initiatives (subject to compliance with the Listing Manual), including: (ii) (iii) (iv) (v) incremental reductions in overlapping or duplicate roles, by way of a shared services platform; streamlining policies and procedures; consolidating outsourcing arrangements with external vendors and other service providers; improving pricing and working capital terms for procurement activities; and partnering for certain sales and distribution activities. 5

6 5. BASIS OF EXCHANGE RATIO 5.1 The Exchange Ratio was arrived at on a willing-buyer-willing-seller basis and was negotiated and agreed upon between UOL and Haw Par with reference to the exchange ratios implied by the following metrics (collectively, the Implied Exchange Ratios ) 4 : the volume-weighted average share prices ( VWAPs ) of UOL Shares and UIC Shares for periods of between one market day and 12 months leading up to and including 20 June 2017 (the Last Trading Day ), being the last full day of trading of the UOL Shares and the UIC Shares on the SGX-ST prior to the trading halt on the UOL Shares and the UIC Shares which was called before the start of trading on 21 June 2017, as illustrated below; and the unaudited net asset value ( NAV ) and unaudited net tangible asset value ( NTA ) per UOL Share and per UIC Share, in each case as at 31 March For illustrative purposes only, the Implied Exchange Ratios (implied by the VWAPs and the unaudited NAV and NTA of the UOL Shares and the UIC Shares respectively) as well as the corresponding premiums/(discounts) payable by UOL for the UIC Sale Shares based on the agreed Exchange Ratio are set out in the tables below: Implied Exchange Ratios based on VWAPs Period VWAP (S$) Exchange ratio UOL Shares UIC Shares (Implied by VWAPs) Exchange Ratio Premium / (Discount) based on Exchange Ratio Last Trading Day % Last five market days up to and including the Last Trading Day One-month period up to and including the Last Last Trading Day Three-month period up to and including the Last Trading Day Six-month period up to and including the Last Trading Day % % % % 4 The premiums/(discounts) of the Exchange Ratio relative to the exchange ratios implied by the VWAPs and historical NAV per UIC Share and per UOL Share that have been calculated in these tables are based on the number of UIC Sale Shares to be acquired, the number of Consideration Shares, and the VWAPs of the UIC Shares and the UOL Shares for historical periods. No adjustments have been made to account for the potential financial effects of the Proposed Transaction in such calculations. 6

7 Period VWAP (S$) Exchange ratio UOL Shares UIC Shares (Implied by VWAPs) Exchange Ratio Premium / (Discount) based on Exchange Ratio 12-month period up to and including the Last Trading Day (2.18)% (ii) Implied Exchange Ratios based on Unaudited NAV and NTA per Share 5 As at 31 March 2017 (S$) UOL Shares UIC Shares Exchange ratio (Implied by unaudited NAV per share) Exchange Ratio Premium / (Discount) based on Exchange Ratio Unaudited NAV per share % Unaudited NTA per share % 6. INDEPENDENT BOARD COMMITTEE UOL had formed an independent board committee comprising Mr. Low Weng Keong, Mr. Gwee Lian Kheng, Mr. Tan Tiong Cheng and Mr. Poon Hon Thang Samuel to evaluate, negotiate and agree on the terms of the Proposed Transaction with Haw Par (the Independent Board Committee ). The Independent Board Committee had appointed KPMG Corporate Finance Pte Ltd to assist in the evaluation and negotiation of the Proposed Transaction. 7. WHITEWASH WAIVER 7.1 As at the date of this Announcement, Haw Par and parties acting in concert with it (including but not limited to, Dr. Wee Cho Yaw) in respect of UOL (collectively, the Wee Concert Party Group ) have an aggregate interest in 337,184,498 UOL Shares, representing approximately per cent. of the total number of issued UOL Shares 6. As a result of the UOL Share Issuance on Completion, the Wee Concert Party Group will increase its shareholding interest in UOL by more than one per cent. in a six-month period to 364,457,225 UOL Shares, representing approximately per cent. of the total number of issued UOL Shares, which will trigger the requirement to make a mandatory general offer under Rule 14 of the Code for 5 The unaudited NAV and NTA per UOL Share and UIC Share was calculated based on a total number of 804,700,403 UOL Shares and 1,419,181,000 UIC Shares (in each case, excluding treasury shares) as at 31 March 2017, as disclosed in the unaudited consolidated financial statements of UOL and UIC respectively for the first quarter ended 31 March Unless otherwise stated in this Announcement, all references in this Announcement to the percentage shareholding in the issued share capital of UOL are based on a total of 812,755,505 UOL Shares as at the date of this Announcement. 7

8 the remaining UOL Shares not already owned, controlled or agreed to be acquired by the Wee Concert Party Group on Completion (unless otherwise waived). 7.2 In light of the above, UOL has made an application to the SIC to seek, inter alia, a waiver of the obligations of Haw Par (or its nominee) to make a mandatory general offer for UOL under Rule 14 of the Code by reason of the UOL Share Issuance resulting in the Wee Concert Party Group s shareholding interest in UOL increasing by more than one per cent. based on UOL s enlarged issued capital following the UOL Share Issuance on Completion in any period of six months (the Whitewash Waiver ). 7.3 On 26 May 2017, the SIC granted the Whitewash Waiver subject to, inter alia, the satisfaction of the following conditions: a majority of holders of voting rights of UOL approve at an extraordinary general meeting ( EGM ) of the shareholders of UOL ( UOL Shareholders ) to be held before the UOL Share Issuance, the Whitewash Resolution by way of a poll to waive their rights to receive a general offer from Haw Par (or its nominee); the Whitewash Resolution is separate from other resolutions to be tabled at the EGM; the Wee Concert Party Group and parties not independent of the Wee Concert Party Group abstain from voting on the Whitewash Resolution; the Wee Concert Party Group did not acquire or are not to acquire any shares in UOL or instruments convertible into and options in respect of shares in UOL (other than subscriptions for, rights to subscribe for, instruments convertible into or options in respect of new shares in UOL which have been disclosed in the circular to be despatched to UOL Shareholders in relation to the EGM (the UOL Circular )): (ii) during the period between the date of this Announcement and the date on which UOL Shareholders approval is obtained for the Whitewash Resolution; and in the six months prior to the date of this Announcement, but subsequent to negotiations, discussions or the reaching of understandings or agreements with the directors of UOL in relation to the UOL Share Issuance; UOL appoints an independent financial adviser ( IFA ) to advise its independent shareholders on the Whitewash Resolution; UOL sets out clearly in the UOL Circular: (ii) (iii) details of the UOL Share Issuance; the dilution effect of the UOL Share Issuance to existing holders of voting rights in UOL; the number and percentage of voting rights in UOL as well as the number of instruments convertible into, rights to subscribe for and options in respect of shares in UOL held by the Wee Concert Party Group as at the latest practicable date of the UOL Circular; 8

9 (iv) (v) (vi) the number and percentage of voting rights to be issued to Haw Par (or its nominee) as a result of the UOL Share Issuance; specific and prominent reference to the fact that the UOL Share Issuance to Haw Par (or its nominee) may result in the Wee Concert Party Group holding shares carrying over 49 per cent. of the voting rights of UOL, and the fact that the Wee Concert Party Group would thereafter be free to acquire further shares in UOL without incurring any obligation under Rule 14 to make a general offer; and that UOL Shareholders, by voting for the Whitewash Resolution, are waiving their rights to a general offer from Haw Par (or its nominee) at the highest price paid by the Wee Concert Party Group for shares in UOL in the past six months preceding the commencement of the offer; and to rely on the Whitewash Resolution, the UOL Share Issuance to Haw Par (or its nominee) must be completed within three months of the approval of the Whitewash Resolution at the EGM. 7.4 UOL understands that the Wee Concert Party Group does not intend to, nor wish to be subject to the obligation to, make a mandatory general offer for UOL as a result of the UOL Share Issuance. As such, UOL will be convening an EGM in due course to seek the UOL Shareholders approval of the Whitewash Resolution, in accordance with paragraph above. Please refer to paragraph 13 below for further details on the EGM. 8. VALUE OF THE UIC SALE SHARES TO BE ACQUIRED 8.1 Open Market Value Based on the VWAP of the UIC Shares on the SGX-ST on the Last Trading Day of S$3.2784, the aggregate open market value of the UIC Sale Shares as at the date of this Announcement is approximately S$196.7 million. 8.2 Book Value and NTA Value Based on the unaudited consolidated financial statements of UIC for the first quarter ended 31 March 2017, the book value attributable to the UIC Sale Shares is approximately S$265.8 million. As the UIC Group did not report any intangible assets as at 31 March 2017, the NTA value attributable to the UIC Sale Shares is also S$265.8 million. 8.3 Net Profits attributable to the UIC Sale Shares Based on the unaudited consolidated financial statements of UIC for the first quarter ended 31 March 2017, the net profits attributable to the UIC Sale Shares is approximately S$2.5 million. 9

10 9. INTERESTED PERSON TRANSACTION 9.1 Interested Person Transaction Chapter 9 of the Listing Manual. Under Rule 904(4)(a) of the Listing Manual, in the case of a company, an interested person means a director, chief executive officer or controlling shareholder of UOL, or an associate of any such director, chief executive officer, or controlling shareholder. Under the Listing Manual, an associate, in the case of a company, in relation to any director, chief executive officer, substantial shareholder or controlling shareholder (being an individual), means, inter alia, his immediate family and any company in which he and his immediate family together (directly or indirectly) have an interest of 30 per cent. or more UOL. As at the date of this Announcement: (ii) (iii) Dr. Wee Cho Yaw is the Chairman and a non-executive and non-independent director of UOL; Mr. Wee Ee Lim is the Deputy Chairman and a non-executive and nonindependent director of UOL; and Mr. Wee Ee-chao is a non-executive and non-independent director of UOL. Further, each of Dr. Wee Cho Yaw and Mr. Wee Ee Cheong is deemed to be a controlling shareholder of UOL as each of them has an interest of more than 15 per cent. in the issued share capital of UOL. The shareholding interest of each of Dr. Wee Cho Yaw, Mr. Wee Ee Lim, Mr. Wee Ee-chao and Mr. Wee Ee Cheong in UOL is as follows: No. Name Direct Interest Deemed Interest Total (1) Percentage 1. Dr. Wee Cho Yaw 3,661, ,808,012 (2) 274,469, Mr. Wee Ee Lim 260, ,873,954 (3) 111,134, Mr. Wee Ee-chao 31, ,148,057 (4) 111,179, Mr. Wee Ee Cheong 318, ,115,947 (5) 226,434, Notes: (1) The interest in the UOL Shares set out above does not include any interests in the UOL Shares held by the immediate family of Dr. Wee Cho Yaw, Mr. Wee Ee-chao, Mr. Wee Ee Lim and Mr. Wee Ee Cheong. (2) Dr Wee Cho Yaw s deemed interest in the UOL Shares arises as follows: (a) (b) 115,162,017 UOL Shares held by C.Y. Wee & Company Private Limited; 110,855,836 UOL Shares held by Wee Investments (Pte) Limited; 10

11 (c) (d) 44,772,041 UOL Shares in which Haw Par is deemed to be interested; and 18,118 UOL Shares held by Kheng Leong Company (Private) Limited. (3) Mr. Wee Ee Lim s deemed interest in the UOL Shares arises as follows: (a) (b) 110,855,836 UOL Shares held by Wee Investments (Pte) Limited; and 18,118 UOL Shares held by Kheng Leong Company (Private) Limited. (4) Mr. Wee Ee-chao s deemed interest in the UOL Shares arises as follows: (a) (b) (c) 110,855,836 UOL Shares held by Wee Investments (Pte) Limited; 274,103 UOL Shares held by Protheus Investment Holdings Pte Ltd; and 18,118 UOL Shares held by Kheng Leong Company (Private) Limited. (5) Mr. Wee Ee Cheong s deemed interest in the UOL Shares arises as follows: (a) (b) (c) (d) 110,855, 836 UOL Shares held by Wee Investments (Pte) Limited; 115,162,017 UOL Shares held by C.Y. Wee & Company Private Limited; 18,118 UOL Shares held by Kheng Leong Company (Private) Limited; and 79,976 UOL Shares held by E. C. Wee Pte Ltd Haw Par. As at the date of this Announcement, the following directors of UOL are also directors of Haw Par: (ii) (iii) Dr. Wee Cho Yaw is the non-executive and non-independent Chairman of Haw Par; Mr. Wee Ee-chao is the Deputy Chairman and a non-executive director of Haw Par; and Mr. Wee Ee Lim is the President and Chief Executive Officer of Haw Par. Further, each of Dr. Wee Cho Yaw, Mr. Wee Ee-chao, Mr. Wee Ee Lim and Mr. Wee Ee Cheong has an aggregate direct or indirect interest of more than 30 per cent. in the issued share capital of Haw Par. The shareholding interest of each of them in Haw Par is as follows: No. Name Direct Interest Deemed Interest Total (1) Percentage 1. Dr. Wee Cho Yaw 1,092,373 77,605,330 (2) (3) 78,697, Mr. Wee Ee-chao 13,826 73,134,135 (2) (4) 73,147, Mr. Wee Ee Lim 437,192 73,001,217 (2) 73,438, Mr. Wee Ee Cheong 128,857 74,678,311 (2) (3) (5) 74,807,

12 Notes: (1) The interest in the Haw Par Shares set out above does not include any interests in the Haw Par Shares held by the immediate family of Dr. Wee Cho Yaw, Mr. Wee Ee-chao, Mr. Wee Ee Lim and Mr. Wee Ee Cheong. (2) Dr. Wee Cho Yaw, Mr. Wee Ee-chao, Mr. Wee Ee Lim and Mr. Wee Ee Cheong are deemed to be interested in the Haw Par Shares held by Wee Investments (Pte) Limited, Supreme Island Corporation and Kheng Leong Company (Private) Limited. (3) Dr. Wee Cho Yaw and Mr. Wee Ee Cheong are deemed to have an interest in the Haw Par Shares held by C.Y. Wee & Company Private Limited and UOL. (4) Mr. Wee Ee-chao is deemed to have an interest in the Haw Par Shares held by Protheus Investment Holdings Pte Ltd. 9.2 NTA (5) Mr. Wee Ee Cheong is deemed to have an interest in the Haw Par Shares held by E. C. Wee Pte Ltd Interested Person. Under the Listing Manual, Haw Par is considered to be an associate of each of Dr. Wee Cho Yaw, Mr. Wee Ee-chao, Mr. Wee Ee Lim and Mr. Wee Ee Cheong, as each of them holds more than 30 per cent. of the issued share capital of Haw Par. Accordingly, for the purposes of Chapter 9 of the Listing Manual, Haw Par would be considered an interested person vis-à-vis UOL, which is regarded as an entity at risk for these purposes, and the Proposed Transaction constitutes an interested person transaction under Chapter 9 of the Listing Manual. As at 31 December 2016, 5 per cent. of the latest audited consolidated NTA of the UOL Group is approximately S$405.1 million. 9.3 No Shareholders Approval under Chapter 9 of Listing Manual Consideration based on Market Value. The value of the aggregate consideration payable by UOL to Haw Par for the UIC Sale Shares based on the number of Consideration Shares and UOL s VWAP as at the Last Trading Day is approximately S$210.2 million Consideration based on NAV. The value of the aggregate consideration payable by UOL to Haw Par for the UIC Sale Shares based on the NAV attributable to the Consideration Shares is approximately S$274.7 million No Shareholders Approval. As the value of the aggregate consideration as set out above (whether calculated based on market value or NAV) is less than 5 per cent. of the UOL Group s NTA, shareholder approval of UOL is not required pursuant to Chapter 9 of the Listing Manual. 7 Based on the unaudited consolidated NAV of the UOL Group as at 31 March 2017 of $8,263,971,000, the market value of the UIC Sale Shares of $196,704,000 based on UIC s VWAP on the Last Trading Day, UOL s enlarged share capital base of 840,028,232 UOL Shares following Completion, and the number of Consideration Shares. 12

13 9.4 Total Value of Interested Person Transactions For the period commencing on the beginning of the current financial year, being 1 January 2017, up to the date immediately preceding this Announcement, being 21 June 2017: no transactions (excluding transactions less than S$100,000 and interested person transactions falling within Rule 908(2) of the Listing Manual, if any) have been entered into between the UOL Group with Haw Par and its subsidiaries; and the total value of all interested person transactions (excluding transactions less than S$100,000 and interested person transactions falling within Rule 908(2) of the Listing Manual, if any) was approximately S$59.2 million, which represents approximately 0.73 per cent. of the NTA of the UOL Group. 9.5 View of Audit and Risk Committee UOL s Audit and Risk Committee (comprising Mr. Low Weng Keong, Mr. Wee Ee Lim and Mr. Tan Tiong Cheng) is obtaining an opinion from Deloitte & Touche Corporate Finance Pte Ltd as the IFA, as described in paragraph 12 below. Such opinion as well as the Audit and Risk Committee s view (with Mr. Wee Ee Lim abstaining and not participating in the discussions relating to the Proposed Transaction) as to whether the Proposed Transaction is on normal commercial terms and is not prejudicial to the interests of UOL and its minority shareholders will be set out in the UOL Circular to be despatched to UOL Shareholders. 10. NON-DISCLOSEABLE TRANSACTION 10.1 Relative Figures The relative figures for the Proposed Transaction computed on the bases set out in Rule 1006 of the Listing Manual are set out below: Rule 1006 (a) (b) (c) (d) (e) Bases NAV of the assets to be disposed of, compared with the UOL Group s NAV Net profits attributable to the assets acquired, compared with the UOL Group s net profits Aggregate value of the consideration given, compared with UOL s market capitalisation based on the total number of issued shares as at 20 June 2017, being the Last Trading Day Number of equity securities issued by UOL as consideration for the Proposed Transaction, compared with the number of equity securities previously in issue Aggregate volume or amount of proved and probable reserves to be disposed of, compared with the aggregate of the UOL Group s proved and probable reserves Aggregate Relative Figures (%) N.A. (1) 3.92 (2) 4.38 (3) 3.36 (4) N.A. (5) Notes: (1) Rule 1006(a) of the Listing Manual is not applicable to an acquisition of assets. 13

14 (2) Under Rule 1002(3)(b) of the Listing Manual, net profits means profit or loss before income tax, minority interests and extraordinary items. Rule 1006(b) of the Listing Manual was computed based on the net profits attributable to the UIC Sale Shares divided by the UOL Group s net profits, based on the audited consolidated financial statements of the UIC Group and the UOL Group for the financial year ended 31 December (3) Under Rule 1003(3) of the Listing Manual, where the consideration is in the form of shares, the value of the consideration shall be determined by reference either to the market value of such shares or the NAV represented by such shares, whichever is higher. As stated in paragraph 9.3, the market value of the Consideration Shares is approximately S$210.2 million and the NAV attributable to the Consideration Shares is approximately S$274.7 million. The relative figure in relation to Rule 1006(c) of the Listing Manual was therefore computed based on the NAV attributable to the Consideration Shares of approximately S$274.7 million. (4) Rule 1006(d) of the Listing Manual was computed based on 27,272,727 Consideration Shares to be issued pursuant to the UOL Share Issuance and (ii) a total of 812,755,505 UOL Shares as at the date of this Announcement. (5) Rule 1006(e) of the Listing Manual is applicable to a disposal of mineral, oil or gas assets by a mineral, oil and gas company, but not to an acquisition of assets Non-Discloseable Transaction As the relative figures for the Proposed Transaction computed under Rule 1006 are all less than 5 per cent., the Proposed Transaction constitutes a non-discloseable transaction for the purposes of Chapter 10 of the Listing Manual of the SGX-ST. 11. FINANCIAL EFFECTS OF THE PROPOSED TRANSACTION 11.1 Bases and Assumptions The pro forma financial effects of the Proposed Transaction on the NTA per share, (ii) earnings per share ( EPS ), and (iii) share capital of the UOL Group, based on the audited consolidated financial statements of the UOL Group for the financial year ended 31 December 2016 ( FY2016 ), are set out below. The financial effects are purely for illustration purpose only and do not reflect the actual financial position and earnings of the UOL Group after Completion As at the date of this Announcement, the UOL Group currently accounts for 44.6 per cent of the share of results of the UIC Group in its books. Upon Completion occurring, the UOL Group will hold per cent of the share capital in UIC. Although the UOL Group will hold less than 50 per cent of the total share capital in UIC, the UOL Group has assessed that it will be able to exercise de facto control over the UIC Group as it will have the largest shareholding interest in UIC. Accordingly, the UOL Group will consolidate the UIC Group in accordance with Financial Reporting Standards ( FRS ) 110 Consolidated Financial Statements The pro forma financial effects set out below assumes that the UOL Group would have consolidated the UIC Group in accordance with FRS 110 Consolidated Financial Statements; (ii) in respect of the NTA and share capital of the UOL Group, the Proposed Transaction had been completed on 31 December 2016; and (iii) in respect of the EPS, the Proposed Transaction had been completed on 1 January

15 11.2 NTA 11.3 EPS Assuming that the Proposed Transaction had been completed on 31 December 2016, being the end of the most recently completed financial year of the UOL Group, the proforma financial effects on the consolidated NTA per share of the UOL Group as at 31 December 2016 are as follows: Before the Proposed Transaction After the Proposed Transaction NTA (S$ million) 8,103 8,594 NTA per share (S$) Assuming that the Proposed Transaction had been completed on 1 January 2016, being the beginning of the most recently completed financial year of the UOL Group, the proforma financial effects on the consolidated EPS of the UOL Group for FY2016 are as follows: Before the Proposed Transaction After the Proposed Transaction (1) Profits attributable to 287, ,361 (3) shareholders (2) (S$ 000) EPS (cents) Notes: (1) The purchase price allocation ( PPA ) exercise in relation to the acquisition of UIC as a subsidiary (assuming Completion has occurred) is still ongoing as at the date of this Announcement. Accordingly, the fair value of the assets and liabilities of UIC following Completion will be adjusted upon finalisation of the PPA exercise. (2) Profits attributable to shareholders means profits after tax and minority interests. (3) The proforma financial effects on the profits attributable to UOL Shareholders include a net gain of approximately S$332.7 million arising from a change in UOL s recognition of its investment in UIC from an associated company to a subsidiary Share Capital Assuming that the UOL Share Issuance had been completed on 31 December 2016, being the end of the most recently completed financial year of the UOL Group, the proforma financial effects on the share capital of UOL as at 31 December 2016 are as follows: Before the UOL Share Issuance (1) After the UOL Share Issuance Share capital (S$ 000) 1,269,853 1,433,217 Number of UOL Shares 804,611, ,884,130 Note: (1) Based on a total of 804,611,403 UOL Shares (excluding treasury shares) as at 31 December This number does not take into account 8,144,102 UOL Shares which have been issued by UOL from 1 January 2017 up to the date of this Announcement. 15

16 12. INDEPENDENT FINANCIAL ADVISER UOL has appointed Deloitte & Touche Corporate Finance Pte Ltd as the IFA to advise such directors who are considered independent for the purposes of making the recommendation to UOL Shareholders in relation to the Whitewash Resolution and to provide an opinion on whether the Proposed Transaction is on normal commercial terms and is not prejudicial to the interests of UOL and its minority shareholders in relation to Chapter 9 of the Listing Manual (collectively, the IFA Advice and Opinion ). The IFA Advice and Opinion will be set out in the UOL Circular to be despatched to UOL Shareholders. 13. EGM AND CIRCULAR TO UOL SHAREHOLDERS The directors of UOL will be convening an EGM to seek the approval of the UOL Shareholders for the Whitewash Resolution. The UOL Circular setting out information on the Proposed Transaction, together with a notice of the EGM to be convened, will be despatched to UOL Shareholders in due course. As set out in paragraph above, a condition to the Whitewash Waiver is that the Wee Concert Party Group and parties not independent of the Wee Concert Party Group are required to abstain from voting on the Whitewash Resolution. As such, Haw Par, Dr. Wee Cho Yaw, Mr. Wee Ee Cheong, Mr. Wee Ee-chao, Mr. Wee Ee Lim and entities through which the abovementioned individuals have a deemed interest in UOL will abstain from voting on the Whitewash Resolution at the EGM. In the meantime, UOL Shareholders are advised to refrain from taking any action in relation to their UOL Shares which may be prejudicial to their interests until they or their advisers have considered the information and the recommendations to be set out in the UOL Circular. 14. SGX-ST LISTING APPROVAL An application will be submitted by UOL to the SGX-ST to seek the Listing Approval in relation to the Consideration Shares. An appropriate announcement on the outcome of such application will be made by UOL in due course. Subject to receipt of the Listing Approval and compliance with such conditions (if any) imposed by the SGX-ST in connection therewith, the Consideration Shares shall, following Completion, be listed and quoted on the Main Board of the SGX-ST. 15. INTERESTS OF DIRECTORS AND CONTROLLING SHAREHOLDERS As at the date of this Announcement, the following directors of UOL are also directors of UIC: (ii) (iii) Dr. Wee Cho Yaw (the Chairman and a non-executive and non-independent director of UOL) is also the non-executive Chairman of UIC; Mr. Wee Ee Lim (the Deputy Chairman and a non-executive and non-independent director of UOL) is also a non-executive director of UIC; and Mr. Gwee Lian Kheng (the Group Chief Executive and an executive and nonindependent director of UOL) is also a non-executive director of UIC. 16

17 Save as disclosed in this Announcement (including in paragraph 9 and this paragraph 15) and save for any shares in the capital of UOL, Haw Par and UIC which the directors and controlling shareholders of UOL may have an interest, none of them has any interest, direct or indirect, in the Proposed Transaction. 16. DIRECTORS SERVICE CONTRACTS No person is proposed to be appointed as a director of UOL in connection with the Proposed Transaction. Accordingly, no service contract is proposed to be entered into between UOL and any such person. 17. DOCUMENTS FOR INSPECTION A copy of the Option Agreement is available for inspection during normal business hours at the registered office of UOL at 101 Thomson Road, #33-00 United Square, Singapore , for a period of three months commencing from the date of this Announcement. BY ORDER OF THE BOARD Foo Thiam Fong Wellington Company Secretary 22 June