Hot stock: Koufu rises 15% on privatisation news

SHARES of food court operator Koufu Group VL6 rose as much as 15 per cent on Thursday (Dec 30) amid heavy trading, after its founding shareholders made a S$0.77 per share cash offer to privatise the company.

The counter last closed at S$0.665 on Tuesday, before the group halted trading of its shares on Wednesday morning.

Shortly after resuming trading on Thursday, the counter jumped as much as 15 per cent or S$0.10 to reach a 1-year high of S$0.765 as at 9.12 am, with 0.9 million shares changing hands. It later eased to trade at S$0.76 as at 9.45 am, up S$0.095 or 14.3 per cent. 

No married deals were recorded in early trade, according to ShareInvestor data.

The privatisation offer values Koufu at S$425.8 million, which is 15 times the operator's pre-pandemic FY2019 earnings and 43 times its FY2020 earnings.

The offeror - Dominus Capital - is an investment company incorporated on Oct 7 by Koufu's executive chairman and chief executive Pang Lim and executive director Ng Hoon Tien, the group said in a bourse filing.

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The husband-wife duo has a deemed interest in 77.41 per cent of Koufu's shares - through Jun Yuan Holdings - which has given an irrevocable undertaking to accept the offer. As at Wednesday, there are about 553 million issued Koufu shares.