South Korea’s Hanwha hits back at estate of Dyna-Mac’s founding shareholder

SOUTH Korean conglomerate Hanwha rebutted criticism from the estate of Dyna-Mac’s founder that its voluntary conditional offer is not compelling, maintaining that its proposition is based on a “rigorous review” of factors affecting Dyna-Mac’s business outlook.

This includes its growth prospects and order book, as well as geopolitical tensions, macroeconomic uncertainties, volatility in oil prices and the global trend towards a clean-energy transition, said Hanwha in a bourse filing on Wednesday (Sep 25).

The estate of Dyna-Mac founder, Desmond Lim, had on Monday said the S$0.60 apiece offer does not “adequately reflect the value and growth potential” of the offshore oil-and-gas contractor.

The single-largest shareholder added that the company has become a “global multidisciplinary” contractor and is “very well-positioned” for strong growth.

In response, Hanwha argued that its offer represents a 21 per cent premium over the last transacted price per share on Sep 10, before the bid was made.

The offer also represents a 5.7x diluted net asset value per share (price-to-book ratio) as at Jun 30, and a 13.2x diluted earnings per share (price-to-earnings ratio) for the 12 months ended Jun 30, added the group.

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Additional information will be provided in its offer document, which will be dispatched by Oct 2.

Hanwha is South Korea’s seventh-largest business group, and its businesses are in the areas of aerospace and mechatronics, clean energy and ocean solutions, finance, as well as retail and services.

Earlier this month, the conglomerate launched a voluntary conditional cash offer through a special-purpose company to take management control of mainboard-listed Dyna-Mac.

The offeror is Hanwha Ocean SG, which was incorporated by shipbuilding company Hanwha Ocean and the group’s defence, aerospace and space arm Hanwha Aerospace. Both companies are listed on the Korea Exchange.

Shares of Dyna-Mac closed flat at S$0.63 on Wednesday.