99.7% of the votes cast were in favor of the proposal.
Union Gas Holdings has received strong support from its shareholders for its proposed acquisition of assets of Union Energy Corporation (UEC), with 99.7% of shareholders voting in favour of the proposal at an extraordinary general meeting on December 27.
According to an earlier announcement on August 25, the proposed acquisition of Sembas (Asia) Trading, Semgas Supply and Summit Gas Systems will pave the way for the strategic upstream expansion of Union Gas’s liquefied petroleum gas (LPG) business into the bottling and storage business, the company said in a statement.
The proposed acquisition is expected to close by December 31 and is expected to cost $75 million. It includes the acquisition of assets including two bottling plants and a significant amount of supporting infrastructure including six LPG storage depots, 71 delivery vehicles and a full commercial and industrial sales team.
In addition, Union Gas will gain ownership of two of the four bottling licenses and bottling plants in Singapore, making it one of the largest LPG producers with the largest bottling operations in the city-state.
The planned acquisition will have a positive impact on profits and is expected to improve Union Gas’s business and financial position, the company said.
“We are pleased that shareholders have recognised the long-term value and potential returns that the proposed acquisition will bring to the Group and look forward to the positive impact we expect it to have on our performance. With control of the entire LPG chain, we have a larger platform to do more and continue to grow,” said Teo Hark Piang, Managing Director and CEO of Union Gas.
The consideration will be paid partly in cash and partly in shares. US$61 million, or 81.3% of the consideration will be paid through the allotment of 88.6 million shares of Union Gas common stock at an issue price of 68.81 cents per share, with the remainder being paid in cash from Union Gas’s own funds.
At 3:01 p.m., Union Gas shares were trading 1.5 cents lower, or 1.96 percent lower, at 75 cents.
Photo: Union Gas Holdings
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