Press Release: SIAS calls upon shareholders of Sin Heng Heavy Machinery Limited to REJECT the voluntary unconditional cash offer of S$0.58 from TAL Ltd

Date: April 21, 2025

The Securities Investors Association (Singapore) or SIAS urges all shareholders of Sin Heng Heavy Machinery Limited to REJECT the voluntary unconditional cash offer of S$0.58 per share that was made by TAL Ltd last month.

SIAS notes that the Independent Financial Adviser (IFA) has recommended that shareholders REJECT the offer on the grounds that it is NOT FAIR AND NOT REASONABLE.

In arriving at its recommendation, the IFA noted that the Group has been profitable from FY2022 to FY2024 with net profits increasing from approximately S$3.65 million in FY2022 to approximately S$6.27 million in FY2024.

The Group has also declared dividends over the last three financial years with dividend yield ranging between 7.61% and 10.99%.

Among other reasons, the IFA’s conclusion to REJECT was based on the Price/Net Asset Value (P/NAV) and Price/Revalued Net Asset Value (P/RNAV) as implied by the Offer Price being below the median and mean of the P/NAV ratios of selected comparable transactions.

SIAS also notes that the offer price is a 41% discount to the estimated net asset value of S$0.98 per share, a figure that would be even higher if a dividend of S$0.05 were to be excluded from the offer price.

SIAS would also like to draw attention to the questions raised by SIAS to Sin Heng Heavy Machinery Limited ahead of the Company’s Annual General Meeting due to be held on 29 April, which have yet to be answered. Please click on the link here to view the questions.

The offeror has said that the price is final and will not be revised and the offer will close on 30 April 2025 at 5:30 pm.  SIAS believes it is in the best interests of all minorities to collectively send a message to the offeror that they will not accept such a lowball offer. No action is required from the shareholders to reject the current offer.

We believe the Company has incurred unnecessary costs to respond to this offer by TAL, which has been deemed not fair and not reasonable. While any party has the right to make an offer to shareholders, SIAS urges all offerors to act responsibly and fairly. If TAL remains sincere in taking the Company private, we believe the offeror should consider the RNAV of $1.15 per share as a starting point.

David Gerald
Founder, President and CEO
SIAS