A GROUP of shareholders who collectively hold an interest of at least 10 per cent in Best World has withdrawn its requisition letter, while reserving its right to issue the requisitions again in the future.
On Monday (Apr 1), the beauty products distributor said it would therefore take no further action relating to the letter “at the present time”.
The Mar 21 letter served as notice requisitioning an extraordinary general meeting (EGM), or as a notice for the resolutions to be considered at the next annual general meeting .
Through the letter, requisitioning shareholders were seeking to table six resolutions regarding the company’s dividend policy and directors’ pay, among others.
In the first resolution, the requisitioning shareholders sought to have the company engage an independent financial adviser to advise the board on the appropriate cash reserves and dividend policy of the group.
The second resolution requested that the board disclose the recommendation of the group’s remuneration committee on the pay of its executive directors.
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Another resolution involved the company disclosing any transactions, as defined by Chapter 10 of the Listing Manual of the Singapore Exchange Securities Trading, upon approval by shareholders in the EGM.
The final three resolutions called for the removal of independent directors Lee Sen Choon, Adrian Chan and Chester Fong.
In the since-withdrawn Mar 21 letter, the requisitioning shareholders also indicated they are open to meeting with the board to discuss the concerns of the requisition letter and to “find common ground” with the board.
At the time, Best World said it was considering the letter’s contents and seeking legal advice.
Shares of Best World : CGN 0% ended Monday S$0.06 or 2.8 per cent higher at S$2.18, before the company announced that the requisition letter had been withdrawn.
Separately on Mar 22, the company announced it was looking to delist from the Singapore Exchange (SGX) by way of a selective capital reduction, citing the poor consumer sentiment and growth headwinds in its China market.
A selective capital reduction refers to the cancellation of all issued ordinary shares in the company, except those held by non-participating shareholders. In return for their cancelled shares, shareholders will receive cash.
Best World said it intends to obtain approval for the selective capital reduction at an EGM, where a special resolution must be passed by eligible shareholders.
It also requires the approval and confirmation of the High Court.
Under its rationale for the bourse exit, Best World noted that its China market is expected to remain challenging, due to uncertainties such as stock market volatility and the challenging property sector weighing on consumer sentiment.
It added that going private could also enable it to dispense with the compliance costs needed to stay listed, as well as costs of other regulatory requirements.
