It was supposed to be one of the more high-profile IPO (initial
public offering) in Singapore this year. However taxi operator Trans-Cab’s IPO has
now been called off.
Why the cancellation you asked? Well, Transcab decided to
cancel the IPO after discovering that it is liable to pay an additional
insurance premium worth $1.83m! According to the company, Trans-cab revealed
that its insurer has rendered the amount as a “premium adjustment” based on
cumulative accident claims against the company's taxi fleet.
Well, that’s great timing isn’t it? Just days after Transcab
announced it’s intention to float on the Singapore Exchange (SGX), it’s insurance
company announced that they will need Transcab to pay more for their vehicle
insurance.
Yes, I’m sure they will say the timing is nothing but a coincidence
but let us be serious here; it is not! So I have to wonder just how legal this
is. Can an insurance company just announce an “adjustment” to an insurance
premium for no reason?
If the answer is yes, then I think we can forget about any
transport company being listed in SGX. No transport company in the world in
their right mind will list here.
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