Singapore Post (SingPost) has announced the release of the special audit report by Drew & Napier LLC and PriceWaterHouseCoopers LLP. It was found that SingPost’s “oversight” in declaring that none of its directors had any interest in its acquisition of FS Mackenzie was a result of carelessness, and having sought external legal advice in respect of the incorrect announcement, based its decision not to issue any correction on legal advice.

It was also pointed out that the group had no prescribed policy, process or procedure for the evaluation and approval of M&A transactions, though there are some broad internal guidelines.

Meanwhile, Mr. Keith Tay has also relinquished his position as Lead Independent Director of SingPost, and will leave the board by 9 May 2016.

Looking ahead, the market will likely monitor SingPost’s Chairman and CEO positions, both of which require seasoned individuals who can continue with the group’s transformation strategy. As the group will be announcing its full year results soon, we put our Hold rating and S$1.37 fair value estimate under review.

Source: OCBC Research - 4 May 2016