IT HAS been almost two months since the Commercial Affairs Department (CAD) began investigating the failed takeover of Jade Technologies by Dr Anthony Soh, yet investors are still left in the dark.

Yet as many traders point out, there is really only one key question to answer: Did he act in good faith in making his offer?

Given the length of time that has passed since the buyout went belly up, many argue that the investigations should have produced some conclusive findings by now.

Answering that key question will help quell the disquiet on a host of other issues, including whether existing safeguards to protect investor interests are adequate.

Letting the issue drag on only risks having the disquiet fester. It could also eventually cast a shadow over the many years of work which the Singapore Exchange (SGX) has put in to establish the disclosure-based regime for listed firms to release information in a timely fashion.

This will be such a shame, given the reputation which Singapore has earned as a blue-chip listing destination for companies all over the world because of the SGX's efforts.

A swift closure will also allow traders to decide if they want to seek legal redress on the huge losses the failed Jade takeover left them.

It has been a saga played out very much in the media eye but it is still worth recounting why the case has generated so much heat.

In February, Dr Soh made an offer of 22.5 cents apiece to buy up the remaining 54 per cent of Jade shares he did not already own. A routine corporate play.

What was unusual was that a week before the acceptance deadline, he suddenly withdrew the offer. This came after he disclosed that two-thirds of his Jade stake had been pledged to Australian broker Opes Prime for a $25 million loan.

Opes had collapsed and these shares, among millions of others, were seized by creditors Merrill Lynch and ANZ Bank and sold on the open market last month to repay loans.

But while Merrill was dumping Jade shares, investors, blissfully ignorant of what was happening behind the scenes, were happily picking them up in the hope of making a small, risk-free profit from Dr Soh's takeover offer.

In the pandemonium that followed the withdrawal of his offer, the shares crashed by 70 per cent, leaving investors well in the red.

The loud chorus of complaints drew watchdogs from all over - the Securities Industry Council, which enforces the takeover code, the Monetary Authority of Singapore and the CAD - all looking into possible irregularities related to the takeover.

Traders question if Dr Soh was sincere in making his initial offer and cite two factors.

The first is whether he had sufficient resources to 'satisfy full acceptances of the offer' .

The other concerns the various disclosures he made over his Jade holdings as it is standard procedure for an offeror to abstain from selling any shares during a takeover period.

Some traders noted that the takeover-offer document dispatched by OCBC Bank in March stated that Dr Soh had a direct 45.97 per cent stake in Jade. The bank was his adviser for the buyout before it abruptly resigned last month.

But subsequent revelations showed that Dr Soh had pledged two-thirds of his Jade stake to Opes and part of the remaining shares to Singapura Finance.

And even before the forced sale by Merrill in early April, Singapura Finance had already been selling down Dr Soh's stake during a period straddling his bid to take over Jade.

With so much of a paper trail to work on, traders and investors are wondering what is stalling CAD investigations.

Surely, more speed is needed by the CAD to resolve the Jade debacle with anguished investors needing some answers fast.

A resolution will also give the SGX and other government bodies a chance to assess the existing regulatory framework and buttress the safeguards protecting investors.

For the rest of us, it will bring a merciful end to one of the most controversial takeovers in Singapore's history.

This article was first published in The Straits Times on May 28, 2008

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