SINGAPORE, Nov 27 (Reuters) - A top executive of Singapore's dominant bus operator Delgro Corp Ltd will lead the new merged company to be formed with major taxi operator Comfort Group Ltd.
Kua Hong Tak, executive director of Delgro will likely be the chief executive officer of the new company, subject to a vote by shareholders, said Lim Jit Poh, non-executive chairman of Comfort, at a news conference on Wednesday.
Lim said he would be the non-executive chairman of the combined and as yet unnamed company after the vote.
Comfort and Delgro announced plans to merge last week to create Singapore's largest land transport group with a market value of around S$1.2 billion ($680 million), making it bigger than state-run rail operator SMRT Corp .
The merged company is expected to continue the policy of paying up to 50 percent of its earnings as dividend, Kua told reporters, in a first news conference since the announcement.
"Hopefully the combined (company) will give us the strength, the depth and the breadth to go overseas and compete in a meaningful way," Kua said.
Comfort and Delgro made an unusually low-key announcement about their merger late last Thursday, issuing only a seven page document to the stock exchange detailing the proposal.
Under the merger, both companies plan to delist and give shareholders stock in a new firm.
Comfort shareholders would receive 1.245 shares of the new company for every Comfort share they own, while Delgro's would get 3.342 shares for each Delgro share.
Company officials said an extraordinary general meeting to approve the merger will be held around March 7, 2003.
If the merger is approved, the shares of both companies would be delisted on March 31, and the new company will be listed on the same day.
NM Rothschild and Sons has been appointed as the financial adviser to the independent directors of Delgro, while Ernst & Young has been appointed as financial advisers to the independent directors of the Comfort Group.
Delgro ended seven cents lower at S$2.16, while Comfort closed 1.5 cents down at S$0.81 on Wednesday.
($1=S$1.765)