Osim CEO Lifts Offer for Massage-Chair Maker to $241 Million

Ron Sim

Ron Sim.

Photographer: Munshi Ahmed/Bloomberg
  • Ron Sim raises offer to S$1.39 per share from S$1.32
  • Osim's stock has been trading above earlier bid in Singapore

Osim International Ltd. Chairman and Chief Executive Officer Ron Sim increased his cash offer by more than 5 percent to S$326.7 million ($241 million) to take Asia’s biggest maker of massage chairs private.

Sim raised his offer to S$1.39 per share from S$1.32 through his investment vehicle, Vision Three Pte. Ltd., according to a statement Tuesday. Osim has been trading above the the original offer price since the offer was first announced on March 7.

Osim rose 1.1 percent to S$1.37 before trading was suspended in the afternoon in Singapore. The shares rose to as high as S$1.40, the highest intraday price since Nov. 3.

The latest offer is final and will close on April 25 and will be extended to shareholders who have already accepted the earlier offer, according to the statement. Sim currently controls 69.36 percent of the company, a slight increase from 68.31 percent he held on to before making his first offer.

“We recommend shareholders to accept the offer, as we keep to our view that the offer is reasonable, ” Jodie Foo, an analyst at Oversea-Chinese Banking Corp., wrote in a note to clients on Tuesday. “The stock lacks strong drivers for earnings growth.”

Net income last year declined 50 percent to S$51.5 million as the currency turmoil across Asia damped sales, the company said in January. Profit will climb to S$57.8 million in 2016, according to the average of eight analyst estimates compiled by Bloomberg.

The eight analysts covering the stock had an average 12-month price target of S$1.18 for Osim, according to data compiled by Bloomberg. Six of them had “hold” ratings, while the remaining two analysts were evenly split with “buy” and “sell” recommendations.

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