UK activist investor Palliser Capital is looking to disrupt the takeover of insurer Great Eastern by majority shareholder OCBC, the Financial Times reported on Wednesday (Jan 15).
Palliser called the deal “gravely unfair” for shareholders, in its appeal to the Monetary Authority of Singapore (MAS) and the Singapore Exchange (SGX), FT said, citing documents it saw.
According to FT, Palliser – which has a stake in Great Eastern – accused OCBC of treating minority shareholders unfairly in its attempted full takeover of the company.
The activist investor said Great Eastern’s board was “highly complacent” in recommending the offer, and has refused to meet Palliser over the issue, FT said.
Palliser said the insurer’s “corporate governance safeguards designed to protect the interest of minority shareholders were lacking or insufficiently robust”, FT added.
In response, the MAS and SGX told Palliser that they were monitoring the case and engaging with both sides, FT reported.
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Palliser is a fund manager based in the UK, and has been involved in several instances of shareholder activism in the past year. In October, it called for Japanese property player Tokyo Tatemono to sell off some holdings and boost corporate governance.
In the same month, it appealed for SK Square – the investment arm of South Korea’s SK Group – to implement corporate value-boosting measures.
In December, it pushed for mining company Rio Tinto to abandon its primary listing in London and unify its corporate structure in Australia.
In May last year, OCBC made a voluntary unconditional general offer of S$1.4 billion for the remaining 11.56 per cent stake in Great Eastern that it does not own, with the aim of delisting insurance arm.
But the deal was deemed to be not fair but reasonable by an independent financial adviser (IFA), and the offeror did not obtain at least 75 per cent of the shares held by independent shareholders.
The offer did, however, result in Great Eastern breaching the minimum free float requirement, and its shares being suspended from trading. SGX has given Great Eastern until Jan 24 to explore options to comply with free float requirements.
BT has reached out to MAS, Great Eastern and Palliser for comment. OCBC and SGX declined to comment.
