Forma Property offer for Ong shunned by investors

THE $1.265 a share bid by Forma Property Investments for all the issued shares of Ong Holdings (Hong Kong) attracted a paltry 10,587 shares, or 0.01 per cent of the issued shared capital, by the expiry of the offer yesterday.

The poor response to Forma's bid was not unexpected as earlier this month Ong announced plans to raise $357 million through a five-for-two rights issue at $1.50 a share.

The stock has traded at a significant premium since the rights issue was unveiled.

The proceeds will be used to finance expansion of the company's investment and stockbroking operations.

The issue also came with three free warrants for every 11 new shares. The warrants allow their owners to subscribe for new shares at $1.88 until December 31.

China-controlled Forma, which bought control of Ong from Chai Toh Investments in April for $66 million or $1.265 a share, twice extended its $1.265 general offer. Forma owns 55.36 per cent of Ong.