Oei Hong Leong and Oei Hong Leong Art Museum have filed a notice of discontinuance to wholly discontinue the originating summons against Raffles Education at no cost on Oct 12.
Raffles Education, on Oct 14, announced that it has consented to the discontinuance and that the notice has been accepted and approved by the High Court.
Accordingly, the legal proceedings between the parties, including Oei’s application for an injunction against the company has concluded.
Oei on Sept 29 sent a legal letter to Raffles Education seeking to inspect the originals or documents related to the proposed acquisition of 35.9% shareholding interests in Langfang Hezhong Real Estate Development, listed in the company’s circular dated Sept 8.
See: Raffles Education receives legal letter from Oei Hong Leong
In the same summons, Oei also sought answers pertaining to the acquisition before voting on the proposed resolution and requested for an injunction to prevent the company from voting or proceeding with the proposed acquisition.
According to Raffles Education, the interim injunctions were not granted and the extraordinary general meeting (EGM) proceeded as usual.
On Oct 1, The Edge Singapore received another letter from Oei to Raffles Education, which set out his reasons for the application and his concerns about the increase in equity stake in Langfang Hezhong Real Estate Development.
In the letter, Oei said that the proposed acquisition did not “make commercial sense”.
The transaction, according to Oei, which had a payment consideration of $50 million in cash to increase Raffles Education’s stake in the Chinese company “troubled” him as the latter’s main asset is in a “remote part of China”.
Oei added that “the Company should have sued the Chinese JV partner [Langfang Heying] for breach of the Option Agreement but it did not” after Langfang Heying “failed to convert the land even after six years” despite they being responsible to do so contractually.
Concluding the letter by calling the proposed acquisition “monkey business”, Oei said that he was “not convinced” that the proposed acquisition to “’obtain majority control’ over Langfang Hezhong and ‘thereafter rationalise the Land for development’ is either doable or practical”.
Shares in Raffles Education closed 0.5 cent higher, or 3.8% up at 13.8 cents on Oct 14.
See also: Oei Hong Leong wants to oust Chew Hua Seng again and Raffles Education CEO Chew Hua Seng refutes CAD claims by Oei Hong Leong
