CosmoSteel Holdings: Compulsory Acquisition Looms as 3HA Capital Crosses 90% Threshold—What Does It Mean for Minority Shareholders?

Key Points for Retail Investors

• 3HA Capital Private Limited (“3HA Capital”) has acquired over 91% of CosmoSteel Holdings Limited’s shares.
• This triggers a compulsory acquisition right under Section 215 of the Singapore Companies Act.
• Minority shareholders are being formally notified: You can require 3HA Capital to buy your shares within three months of the notice date.
• The acquisition price will be the same terms offered to approving shareholders, unless otherwise directed by the High Court.
• The window for action is limited—shareholders must respond within three months of 15 August 2025.
• This event is likely to be price sensitive as it may lead to CosmoSteel’s delisting and impact liquidity.

What’s Happening?

CosmoSteel Holdings Limited (“CosmoSteel”) has announced that 3HA Capital Private Limited (“3HA Capital”) has successfully acquired approximately 91.20% of its ordinary shares as of 1 August 2025. This follows an offer and transfer process that began on 15 May 2025 and concluded on 1 August 2025. The acquisition surpasses the critical 90% threshold, triggering significant consequences for minority shareholders under Section 215 of the Companies Act.

Why Is This Important?

Compulsory Acquisition Rights: Under Singapore law, once a shareholder (or group of related corporations) crosses the 90% ownership threshold, minority shareholders who did not accept the offer (“non-assenting shareholders”) are entitled to require the acquirer (3HA Capital) to purchase their shares at the same price and terms offered to those who approved the scheme.

This means that small investors who did not tender their shares during the offer period now have a formal, time-limited opportunity to exit their positions—potentially at a premium, depending on the offer price compared to the market.

What Should Shareholders Do?

• Act Fast: Non-assenting shareholders must notify 3HA Capital within three months from the date of the notice (i.e., by 15 November 2025) if they want their shares to be acquired on the same terms as the initial offer.
• Check Offer Terms: The acquisition will be at the same price and terms as those received by assenting shareholders. If you believe the terms are unfair, you may apply to the General Division of the High Court to seek different terms.
• Potential Delisting: With over 90% control, 3HA Capital is positioned to privatize CosmoSteel, which may result in the company being delisted from the Singapore Exchange. This can materially affect share liquidity and value for any remaining minority holders.
• Value Impact: The compulsory acquisition and potential delisting are typically regarded as price-sensitive events. Shareholders should closely monitor announcements and market movements, as the share price may react to the anticipated privatization or corresponding exit terms.

What Happens Next?

Once notified by a minority shareholder, 3HA Capital is legally entitled and bound to acquire those shares at the stated terms. If there is any dispute over the fairness of the price, either party can approach the High Court for a ruling. Shareholders who do not take action may find themselves holding illiquid shares in a company that could be delisted.

Takeaways for Investors

• This is a critical juncture for CosmoSteel Holdings’ shareholders.
• If you have not yet sold your shares to 3HA Capital and wish to exit, you must act within the three-month window.
• The process may impact CosmoSteel’s share price and liquidity, making it highly relevant for both current and prospective investors.
• Failure to act could result in holding shares in a private, potentially illiquid company, with limited options for sale.

Disclaimer: This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell any securities. Investors should consult their financial advisors and review official documents before making any investment decisions. The situation described herein may evolve and investors should stay updated with official company announcements.

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