KUALA LUMPUR (Sept 23): Malaysia's Employees Provident Fund (EPF) had trimmed its stake in Singapore-listed glove maker Riverstone Holdings Ltd for the first time on record to below 7% after selling 284,900 Riverstone shares for S$287,207.69 (about RM899,913) on the open market on Monday (Sept 20).
According to Riverstone's filing with the Singapore Exchange yesterday (Sept 22), the EPF’s deemed interest in Riverstone fell to 6.981% comprising 103.47 million shares after the transaction.
Before the transaction, the EPF had a 7% stake comprising 103.76 million shares in Riverstone, according to the filing.
Based on Riverstone's filings, the EPF is believed to have emerged as a substantial shareholder in the company on Sept 17, 2020 when it raised its direct interest in Riverstone to 5.13% comprising 38.09 million shares after the EPF acquired two million shares for S$6.58 million on the open market on that day.
Prior to the transaction, the EPF owned a direct stake of 4.861% comprising 36.09 million shares in Riverstone, according to the company’s filing on Sept 21, 2020.
The EPF had subsequently bought more Riverstone shares in one transaction each in October and December 2020 to raise its stake in the company to about 7% before the share disposal on Monday (Sept 20, 2021).
Calculations by theedgemarkets.com show that the sale of the 284,900 Riverstone shares for S$287,207.69 on Monday (Sept 20, 2021) translated into a selling price per share of S$1.01.
Riverstone’s share price closed at S$1 on that day.
On Sept 17, 2020, the EPF's acquisition of two million shares for S$6.58 million translated into an acquisition price per share of S$3.29.
The transaction happened before Riverstone’s share price was adjusted as the stock was traded ex-bonus issue in conjunction with the company’s bonus issue of 742.45 million new shares. Riverstone had on Aug 18, 2020 announced that the company had proposed a bonus issue of 742.45 million new shares on the basis of one bonus share for one existing share held. On Nov 18, 2020, Riverstone said the 742.45 million bonus shares comprising 741.08 million new shares and 1.37 million treasury shares had been allotted and issued on Nov 17, 2020 to shareholders whose names appeared in the share transfer books and register of members of the company as at the record date on Nov 10, 2020 at 5 pm. Riverstone said the bonus shares were listed and quoted on the Singapore Exchange with effect from 9am on Nov 19, 2020.
After the share price adjustment, Riverstone’s Sept 17, 2020 theoretical ex-bonus issue share price closed at S$1.64.
A glance across Riverstone’s share price chart shows that the stock’s price had closed at its record high of S$2.35 on Aug 7, 2020 as the Covid-19-induced glove demand generated investor interest in shares of rubber glove manufacturers.
At the time of writing today, the EPF could not be immediately reached for a response on why the EPF sold Riverstone shares at S$1.01 each on Monday (Sept 20, 2021).
According to Riverstone’s website, the company, which was established in 1989, has three glove factories comprising one each in Thailand, China and Malaysia, where its factory is located in Taiping, Perak.
"To cope with growing demand, we have increased our capacity by setting up a new manufacturing plant in Thailand in year 2001, and another one in Wuxi, China in year 2004.
"Later in year 2010, we built a new plant in Taiping, equipped with only state-of-the-art manufacturing facility to keep our promises for premium quality,” Riverstone said.