SINGAPORE Post (SingPost) said on Wednesday (Feb 26) it will hold an extraordinary general meeting (EGM) to seek shareholders’ approval for the proposed divestment of its Australia business, Freight Management Holdings (FHM).
The EGM will be held on Mar 13 at 3.30 pm.
“This EGM provides our shareholders with the opportunity to vote on this important transaction, which we believe will unlock substantial value,” said SingPost chairman Simon Israel.
The transaction represents an enterprise value of A$1.02 billion (S$867 million).
From the divestment, the SingPost group expects to receive gross proceeds of about A$775.9 million in cash.
The transaction is expected to generate a gain on disposal of around S$289.5 million.
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The group intends to utilise some of the proceeds to repay borrowings, in particular, its Australian dollar-denominated debt amounting to A$362.1 million as at Sep 30, 2024. The loan was undertaken for the financing of the acquisition of FMH.
The board is also considering the payment of a special dividend.
Further announcements on the special dividend will be made when the year-end financial statements of the group are released. SingPost’s financial year will end in March.
It added that the board will disclose in due course the amount of the special dividend, and the amount of residual proceeds that would be retained, subject to the outcome of its strategy reset.
In July 2023, the board initiated a strategic review of the group’s portfolio of businesses, with a view to enhancing shareholder returns and ensuring that the SingPost group is appropriately valued.
In March 2024, the board outlined its strategic intentions for the businesses. In line with this, it initiated a strategic review specifically for the Australia business to formulate optionalities for the group.
Shares of SingPost closed flat at S$0.55 on Tuesday, before the announcement.
