GRIN - Grindrod Shipping: Minority Shareholder Buyout Proposal Might Not Pass

2024-04-05 21:05:23 ET

Summary

• Grindrod Shipping shares rallied by 30% after the company announced plans to buy out minority shareholders for $14.25 in cash per common share.
• The offer represents a 12% discount to estimated net asset value and an approximately 45% discount to controlling shareholder Taylor Maritime's $26 cash tender offer back in 2022.
• However, with Taylor Maritime not permitted to vote on the proposal, approval won't be an easy task.
• Singapore law requires a 75% majority of shareholders to pass a special resolution on a yet to be scheduled extraordinary general meeting which appears to be a Herculean task.
• With approval anything but certain and shares trading just 4% below the proposed buyout price, I would strongly advise investors to consider selling into the open market next week to avoid the risk of shares giving back all of Thursday's gains in case the special resolution doesn't pass.

Note:

I have covered Grindrod Shipping Holdings Ltd. (NASDAQ: GRIN ) previously, so investors should view this as an update to my earlier articles on the company. ...

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