Popiah King to invest S$18.45m in Halcyon Agri

SINGAPORE billionaire Sam Goi Seng Hui is set to emerge with a 5.94 per cent stake in Catalist-listed rubber firm Halcyon Agri Corp once he picks up 25 million new Halcyon shares under a proposed placement that will cost S$18.45 million.

The shares will be placed out to Mr Goi at 73.8 Singapore cents a piece - a discount of 9.88 per cent to Halcyon's weighted average price of 81.89 Singapore cents on Aug 22, a day before the placement agreement was inked.

Halcyon's shares were last traded at 81.5 Singapore cents on Monday before trading in the counter was halted on Tuesday pending the announcement.

"Mr Goi's experience in successfully developing a global food processing business presents an important source of counsel and advice," said Halcyon in an announcement to the exchange.

Mr Goi, 65, was introduced to the firm for the share placement exercise by Halcyon's executive chairman and chief executive Robert Meyer.

Mr Goi, better known as Singapore's "Popiah King", is executive chairman of property firm GSH Corp, food and beverage firm Tee Yih Jia Group and Yang-zhou Junhe Real Estate Group, and also has strategic investments in listed and private entities in diverse industries from food and beverage, consumer essentials and recycling to distribution and logistics.

Halcyon said the placement is meant to shore up the firm's capital position for further growth and expansion.

Over the last 15 months, Halcyon, through the acquisition of Anson Company for which it forked out S$450 million to buy from Lee Rubber, has bumped up its licensed capacity nearly seven-fold from 110,000 tonnes per annum in 2012 to 748,000 tonnes.

Anson owns nine rubber factories in Indonesia.

"This growth in productive capacity implies a commensurate increase in working capital requirement, offset, to a degree, by the current weak market prices for natural rubber," said the firm.

More recently, it proposed buying New Continent Enterprises, a global dealer and distributor of natural rubber, for US$30 million to match its customer mix to the consumer profile of Natural Rubber. Both these acquisitions, said the firm, will transform Hal-cyon to become a top five rubber producer globally.

"At this juncture, management views it as prudent to fortify the working capital resources in anticipation of a recovery in rubber prices and further growth in produced and distributed volumes," said Halcyon, adding that the proceeds from the placement are not required to fund the acquisitions of Anson or NCE.

The firm's issued and paid up share capital will increase to 421,000 shares once the placement, which will give Mr Goi a 5.94 per cent stake in the enlarged firm, is complete.

As a result of the enlarged share base, Lynette Le Mercier, who currently owns 15.53 per cent in Halcyon, will cease to be a controlling shareholding as per Catalist rules. Her interest will be cut down to 14.61 per cent post-placement, with her still remaining as the single largest shareholder.

Halcyon also said it may consider a proposed transfer to the mainboard sometime early next year, which will position the firm appropriately and better allow it to attract institutional investors and reach out to a wider investor base.