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Lung Kee (Bermuda) secures conditional approval for SGX delisting

Hong Kong-based mould maker, Lung Kee (Bermuda), has received conditional approval from the Singapore Exchange (SGX) for its proposed voluntary delisting, aiming to streamline operations and cut costs, while maintaining shareholder interests.

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Lung Kee (Bermuda), a prominent mould maker headquartered in Hong Kong, has received conditional approval from the Singapore Exchange (SGX) for its proposed voluntary delisting from the SGX.

Announced by Lung Kee last Friday (22 Sept) marks an important strategic move for the company, which currently maintains a secondary listing on the mainboard of SGX alongside its primary listing on the Stock Exchange of Hong Kong (SEHK).

The rationale behind Lung Kee’s decision to pursue this voluntary delisting is rooted in several key considerations that are seen as being in the best interests of its shareholders.

Firstly, the company has observed that the trading volume of its shares on SGX has been consistently low, making it challenging to achieve the liquidity and market activity levels seen on the SEHK.

Lung Kee has reported that the trading volume of its shares on the SEHK significantly exceeds that on the SGX, making it a more viable platform for the company’s shares.

Secondly, the proposed delisting is expected to result in the elimination of additional administrative overhead and compliance costs associated with maintaining a secondary listing on SGX.

This move aligns with Lung Kee’s objective to streamline its compliance obligations, reduce legal and compliance expenses, and focus its valuable resources more efficiently on its core business operations.

Furthermore, Lung Kee’s historical experience with fundraising activities in Singapore has been minimal since its shares were originally listed on SGX in 1997.

The company’s board of directors believes that the primary listing on the SEHK is more than adequate to meet its future debt and equity fundraising requirements.

This confidence in SEHK’s capacity to support the company’s financial needs and future development forms an integral part of the motivation behind the proposed delisting from SGX.

Notably, the proposed delisting does not require a general meeting to obtain shareholders’ approval, and no exit alternative needs to be offered to shareholders in connection with the move.

The process has been set in motion with an application submitted to SGX, and the actual delisting is scheduled to take place on or around 5 Feb, 2024.

In response to Lung Kee’s application, SGX has indicated that it does not object to the proposed delisting, provided that certain conditions are met by the company.

These conditions include the prompt dissemination of an announcement regarding the proposed delisting via SGXNet, as well as the issuance of a notice to shareholders holding shares through the central depository (CDP) traded on the SGX-ST, at least three months prior to the delisting date.

Additionally, the notice to shareholders should transparently detail any actions required by them in relation to the proposed delisting, including any costs they may need to bear.

SGX emphasises that CDP depositors who do not take any action during the share transfer period will need to make their own arrangements for lodging their shares with SEHK’s central clearing and settlement system (CCASS) or a relevant broker if they wish to sell or trade their shares on the SEHK subsequently.

Lung Kee will not bear any charges that may be incurred in connection with the deposit of such shares into the CCASS.

Furthermore, the same notice must be addressed to banks that are approved by the Supplementary Retirement Scheme (SRS), and it must be sent to these approved banks at least three months before the delisting date.

It is important to note that SGX’s confirmation of having no objections to the proposed delisting should not be construed as an endorsement of the merits of the delisting.

Should the proposed delisting proceed as planned, Lung Kee shares will be delisted from the official list of the SGX and will henceforth be traded exclusively on the SEHK.

Importantly, the voting rights and entitlement to dividends of shareholders, including the CDP depositors, will remain unaffected by the proposed delisting, as affirmed by the company.

To ensure that all stakeholders are well-informed and prepared for this transition, Lung Kee intends to dispatch the notice to CDP depositors and SRS-approved banks on or around 23 Oct, 2023.

In the interim, the company has advised CDP depositors to exercise caution when dealing in their shares and refrain from any actions that could be detrimental to their interests.

Furthermore, Lung Kee has committed to issuing further announcements to shareholders as the process unfolds, including details of the timetable for the proposed delisting and instructions for actions to be taken by CDP depositors.

Shares of Lung Kee last traded at S$0.48 on the SGX on 4 Sep.

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ST Telemedia Global Data Centres reinforces commitment to Digital India with US$3.2 billion investment

ST Telemedia Global Data Centres (STT GDC) is investing US$3.2B to expand its data centre capacity in India by 550MW, tripling its IT load. The move supports India’s growing digital economy and aligns with PM Modi’s Digital India vision, discussed during his recent visit to Singapore.

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6 September 2024

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ST Telemedia Global Data Centres (STT GDC), a leading data centre colocation services provider headquartered in Singapore, has announced a major investment of US$3.2 billion (INR 26,000 crores) to significantly expand its data centre capacity in India.

This investment will add 550MW of data centre capacity over the next 5-6 years, nearly tripling the Temasek-backed company’s IT load capacity to meet the increasing demands of India’s rapidly growing digital economy.

The expansion is set to support the surge in data consumption, cloud computing, digital transformation, and the adoption of artificial intelligence (AI) applications across India. STT GDC, which already holds a 28% market share in India by revenue, views this move as a reflection of its confidence in the country’s digital infrastructure needs and the broader vision of Digital India.

“India’s digital economy is growing at almost three times the overall GDP growth rate and is expected to reach US$1 trillion by 2027-2028,” said Bruno Lopez, President and Group CEO of STT GDC.

“As we celebrate our 10th anniversary, this ambitious expansion underscores our commitment to Digital India, and we are confident in our ability to contribute to its long-term success.”

STT GDC India, majority-owned by STT GDC in partnership with Tata Communications Ltd, currently operates 28 data centres across 10 cities with a total capacity of over 318MW.

It serves approximately 1,000 enterprise clients, including many Fortune 500 companies. STT GDC India has also been recognized as a Great Place to Work for five consecutive years and is ranked among the Best Places to Work in Asia.

The announcement follows STT GDC’s participation in a Business Roundtable with Indian Prime Minister Narendra Modi on 5 September 2024, hosted by the Singapore Business Federation.

This strategic engagement further emphasizes STT GDC’s commitment to supporting India’s digital transformation through long-term investment and collaboration.

Prime Minister Modi’s visit to Singapore resulted in various agreements across key sectors, including a healthcare cooperation agreement between India and Singapore to collaborate on healthcare delivery, medical research, and digital health solutions.

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Giant to shut Toa Payoh supermarket in September, ninth closure in 2024

Supermarket chain Giant will shut its ninth store in Singapore by September 2024, citing tough competition from online retailers and grocery rivals. The Toa Payoh outlet is part of a series of closures this year, reflecting broader regional challenges for its parent company, Dairy Farm International (DFI).

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6 September 2024

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SINGAPORE: Supermarket chain Giant will close its ninth store in Singapore by September 2024 as it faces intense competition from online retailers and other grocery chains.

The store, located in Toa Payoh Lorong 4, is the latest in a series of closures that have taken place this year, as reported by The Straits Times.

Since February, Giant has shut down a hypermarket in Sembawang Shopping Centre, supermarkets in Bishan, Ang Mo Kio, and Bukit Panjang, along with four smaller “Express” stores in Nanyang Technological University, Pasir Ris, Redhill, and Punggol.

Following the closure of the Toa Payoh outlet, Giant will operate 45 stores across Singapore, down from 53 earlier this year.

Despite these reductions, the grocer has also opened a new outlet in Tengah in 2024.

From 2020 to 2023, the number of Giant stores in Singapore remained relatively stable, hovering between 53 and 55.

However, the recent closures highlight broader challenges faced by its parent company, Hong Kong-based Dairy Farm International (DFI), which has seen a contraction in its regional presence.

DFI, which first entered the Malaysian grocery market in 1999, exited the country in March 2023 by selling its stake in GCH Retail, the operator of the Giant, Mercato, and Giant Mini chains.

Similarly, in 2021, PT Hero Supermarket, a retail group majority-owned by DFI, closed all of its Giant supermarkets in Indonesia after the group’s revenue fell by 34% year-on-year.

In April, the Business Times reported that DFI had put the 9,731 sq ft Housing Board retail unit in Toa Payoh, currently occupied by Giant, up for sale at a guide price of S$16.5 million.

The company stated that the sale was part of a strategy to reallocate resources and focus on improving customer experience in other stores.

DFI’s half-year earnings report published on 1 August 2024 revealed that its food operations in Singapore experienced declining sales due to challenging consumer sentiment.

Despite this, the group posted underlying profit growth, reaching US$76 million.

The company attributed this profitability boost to an improved product margin mix and effective cost control measures.

In response to the Singapore’s Toa Payoh outlet closures, a DFI spokesperson told ST that the company continuously evaluates its store network and adapts to market trends and consumer needs.

“Giant and Cold Storage remain core businesses of DFI Retail Group, and our commitment to growth and expansion in Singapore remains unchanged,” the spokesperson added.

According to DFI’s official website, the group operates in 13 countries and territories, with around 11,000 outlets and a workforce of approximately 200,000 employees.

In Singapore, DFI operates not only Giant supermarkets but also 7-Eleven convenience stores and the Guardian health and beauty chain.

The group’s parent company, DFI Retail Group Holdings Limited, is incorporated in Bermuda and is primarily listed on the London Stock Exchange under the equity shares (transition) category, with secondary listings in Bermuda and Singapore.

DFI’s businesses are managed from Hong Kong by DFI Retail Group Management Services Limited, through its regional offices. The group is a member of the Jardine Matheson Group.

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