Reclaims Global Limited Announces Proposed S\$38.8 Million Acquisition of Freehold Commercial Property

Key Points for Investors

• Acquisition Target: 100% of Lasidon Holdings Pte Ltd, which owns a freehold commercial property at 291 Serangoon Road, Singapore.
• Transaction Value: Total consideration of S\$38,800,000, with possible adjustments post-completion.
• Property Details: 6-storey office building with basement carpark, freehold tenure, gross floor area of 506.8 sqm, currently tenanted.
• Strategic Rationale: Redevelopment potential to increase building efficiency, net lettable area, and long-term capital value; aligns with company’s approved diversification into property investment and development.
• Financial Impact: Slightly dilutive to net tangible assets and earnings per share. Relative transaction size is 68.4% of market capitalisation, making it a “discloseable transaction” under SGX Catalist rules.
• Funding: Through a mix of bank borrowings and internal resources.
• Conditionality: Completion subject to due diligence, regulatory approvals, and fulfillment of various conditions precedent.
• Shareholder Approval: Not immediately required, but may be sought if final asset value adjustments push the deal into “major transaction” territory (>75% of market cap).
• Risk Management: Vendor indemnity for 12 months after completion covering breaches, tax, and tenant claims.

Detailed News Article

Reclaims Global Limited has entered into a share purchase agreement (SPA) to acquire 100% of the shares of Lasidon Holdings Pte Ltd from Sky Property Pte. Ltd., marking a significant investment into Singapore’s commercial property market. The target company owns a freehold, six-storey office building at 291 Serangoon Road, Singapore 218107, which is fully tenanted. The deal, valued at S\$38.8 million, could signal a major step in the company’s ongoing strategic pivot into the real estate sector.

Transaction Structure and Genesis

The acquisition follows an initial arrangement between the vendor and a third party, LBD Engineering Pte. Ltd. (the “Initial Purchaser”), who had agreed to buy the shares for S\$38.8 million and paid a 1% deposit (S\$388,000). Reclaims Global was subsequently nominated by the Initial Purchaser as the new buyer, in exchange for a nomination payment of S\$1.5 million and reimbursement of the deposit. This nomination arrangement ensures that if the deal falls through, all initial payments will be refunded to Reclaims Global.

Property and Target Company Details

• Lasidon Holdings Pte Ltd is primarily a holding company, with unaudited net assets of S\$28.17 million and a net loss of S\$165,000 as at 31 October 2025.
• The property has a gross floor area of 506.8 sqm and is currently income-generating via existing tenancies. Independent property valuers estimate its fair market value to be between S\$40 million and S\$45 million.
• The acquisition is intended to facilitate the redevelopment of the property to optimize its usage and enhance long-term value, with expectations of capital appreciation and rental income upside.

Terms and Conditions

• The purchase consideration comprises the nomination payment and the adjusted net asset value of Lasidon Holdings as at completion, based on an agreed property value of S\$38.8 million.
• Payments will be made in tranches: (a) nomination payment and deposit reimbursement to the Initial Purchaser, (b) S\$1.552 million deposit to the vendor upon signing the SPA, and (c) the balance upon completion, adjusted for the net asset value.
• Vendor must deliver a debt-free company, with all receivables collected and payables settled pre-completion, and ensure the property is free from encumbrances and material adverse changes.
• Completion is expected within four months of the SPA date, subject to satisfactory due diligence and fulfillment of all conditions. If conditions are not met, the non-defaulting party may terminate, defer, or proceed with completion as appropriate.
• Upon completion, Lasidon Holdings will become a wholly owned subsidiary of Reclaims Global.
• If terminated, all initial payments are refundable to Reclaims Global within five business days.
• The vendor provides a 12-month post-completion indemnity for breaches, tax claims, and tenant disputes, capped at the purchase consideration with a claims threshold of S\$50,000.

Financial Effects and Shareholder Impact

• Net Tangible Assets (NTA): NTA per share is expected to decrease from 25.8 cents to 25.4 cents.
• Earnings Per Share (EPS): EPS for FY2025 would decline from 4.3 cents to 3.8 cents, reflecting the initial loss-making nature of the target and transitional costs.
• Relative Size: The consideration is 68.4% of Reclaims Global’s market capitalisation, classifying the deal as a “discloseable transaction” under SGX Catalist rules. Shareholder approval is not required at this stage, but may be necessary if asset value adjustments push the deal size above 75% of market cap.
• Funding: The deal will be financed through a combination of internal resources and bank borrowings, reflecting management’s confidence in leveraging the group’s balance sheet for strategic growth.
• No new shares will be issued; the deal is entirely cash-funded.

Other Noteworthy Points for Shareholders

• None of the company’s directors or controlling shareholders have any interest in this transaction, other than via their existing shareholdings.
• No changes to the board or new service contracts are contemplated as part of this deal.
• The company cautions that if the final asset value differs materially from estimates, shareholder approval may be required prior to completion and final payment.
• Investors may inspect key transaction documents at the company’s registered office for three months after the announcement, by prior written request.
• Reclaims Global will provide further updates should there be any material changes or developments.

Potential Share Price Sensitivities

• This sizeable acquisition marks a significant expansion into commercial property and could materially alter the company’s asset base, leverage, and earnings profile.
• Short-term dilution in NTA and EPS may be viewed negatively, but long-term value creation potential exists via property redevelopment and rental yield enhancement.
• The transaction’s scale (68.4% of market cap) and potential for reclassification as a “major transaction” may introduce volatility or require a general meeting of shareholders should asset values adjust upwards.
• Successful execution and value creation could be a positive share price catalyst; conversely, delays, cost overruns, or negative due diligence findings could pressure the share price.

Disclaimer

This article is for informational purposes only and does not constitute investment advice or an offer to buy or sell any securities. Investors should conduct their own due diligence and consult their financial advisors before making any investment decisions. The information is based on company disclosures as at the date of announcement and may be subject to change.

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