On Nov 8, shares in Golden Energy and Resources saw a 25.6% decline with the counter closing at 67 cents for the end of the day. As its share price dipped, the group on Nov 9 proposed to delist.
In conjunction with the delisting, Duchess Avenue is offering a conditional exit offer to acquire all the shares, excluding treasure shares, if any, held by shareholders at the cash consideration of 16 cents per share on top of the option to receive either shares (worth 88.5 cents) or a cash consideration (worth 68.6 cents) of its Indonesia-listed company PT Golden Energy Mines (GEMS).
The exit offer of 16 cents per share is conditional on the satisfaction of certain conditions, including, among others, shareholders having passed the distribution resolution and the delisting resolution at the extraordinary general meeting (EGM) and the proposed distribution coming into effect.
The group says that its rationale for delisting is part of its broader strategy to reduce its exposure to energy coal. It proposes to segregate its existing energy coal business currently conducted by GEMS.
In conjunction with the delisting, the group will be reducing its capital in PT Golden Energy Mines, such that GEMS will be effectively segregated from the group.
Such segregation will allow the group to reposition itself away from the energy coal industry which is currently facing environmental, social and governance (ESG) pressures, allowing it to expand on its financing options which would otherwise have been relatively limited if it were to be continuously exposed to the energy coal business. Ultimately, the Group will then be able to focus on developing the other business lines with a more streamlined corporate structure.
This is intended to unlock value for shareholders, as shareholders have the option if it so chooses, to directly own GEMS Shares, or otherwise, receive an equivalent value represented by the cash alternative price.
For the last three financial years, GEMS has declared dividends with a dividend payout ratio range of approximately 81% to 133%.
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