PST – BT

Net exit offer for each PST unit is 42.27 US cents

This is after deduction of Q3 distribution

THE net exit offer price for Pacific Shipping Trust’s (PST) delisting will be 42.27 US cents per unit, after deducting the third-quarter distribution of 0.73 US cent from the offer of 43 US cents by Pacific International Lines (PIL).

PIL detailed this in its exit offer letter sent yesterday to unitholders of PST.

PST, which is the Singapore Exchange’s first listed shipping trust, received a voluntary offer from its sponsor PIL to delist in October.

An extraordinary general meeting (EGM) will be held on Dec 16 to approve both the delisting of PST and the exit offer.

A green light for both resolutions requires at least 75 per cent of total issued units held by unitholders present and voting as well as the tally of nay votes not exceeding 10 per cent of the total issued units.

PIL holds some 76 per cent of the total number of issued units and it will vote all of its units in favour of a delisting.

The last date to submit the proxy form of the EGM is Dec 14, 10am.

PIL’s offer of 43 US cents represents a 15 per cent premium to its last traded price of US$0.375 on Sept 29.

After PST is delisted, PIL intends to streamline PST’s operations which may include plans to sell PST’s fleet to PIL or the redeployment of employees to other entities owned by PIL.

It may also wind up the operations of PST.

PST cited the low trading liquidity with an average daily trading volume that represents about 0.1 per cent of the trust’s total free float as a reason to delist.

Going private would also give it greater operational flexibility.

‘Any potential acquisitions will be benchmarked against PST’s distribution yield to ensure that they are accretive to unitholders,’ said PST.

‘This places a constraint on PST’s ability to issue new units since its investment decision will be compared against its distribution yield, which is in turn a function of the prevailing trading prices of the units.’