TODAY'S HEADLINE

PRIVATISATION TIDE RISING IN SINGAPORE  
More companies delisting from SGX as valuations reach attractive levels

The wave of delistings in Singapore this year is expected to continue, thanks to pent'up liquidity in the hands of majority owners and the general malaise in the equity markets, market watchers say.

Broadly, the current delisting trend is an extension from a year ago, 'gures from Dealogic suggest.

The total value of delisting deals that have been announced this year stood at over US$7.09 billion from eight transactions, according to Dealogic data.

Stripping out the behemoth takeover of Asia Paci'c Breweries (APB) by Heineken that is worth over US$6 billion, the total value of announced delistings so far stands at some US$1.09 billion. By comparison, a total of 13 delistings, worth about US$2.67 billion in total, were announced last year. This was again skewed by a single large deal  '  the approximately US$1.4 billion takeover of Kim Eng Holdings by Malaysia's Maybank.

Without that, the total value of delistings in 2011 stands at about US$1.28 billion, Dealogic data shows. Singapore's delisting trend mirrors the situation in Asia. A total of 63 delistings in Asia (excluding Japan) worth US$41.1 billion have been announced so far this year  '  the largest deal being DBS Group's US$7.34 billion proposed takeover of PT Bank Danamon in Indonesia, Dealogic 'gures show.

This already surpasses the US$32.1 billion from 80 delisting deals that were announced last year.

With the exception of Heineken's proposed takeover of APB, the acquirers of Asian targets also come from Asia  '  a indication of strength in Asian companies's balance sheets, as they invest to grow.

For one thing, delistings are typically suitable for listed companies that have shares concentrated in the hands of a few major shareholders. This results in low trading liquidity of such stocks.


NEWS BUZZ
Roxy'Paci'c Holdings (S$0.455) 
Acquires site
Roxy'Paci'c Holdings, through RH Rochor, has entered into an agreement to acquire a freehold residential site at 7, 9, and 11 Wilkie Terrace for $33mil. The site has an estimated total land area of 13,209 sq  ft  and an existing gross plot ratio of 2.1.

LionGold Corp (S$1.24)  
Castlemaine stake tops 97%
LionGold Corp has increased its stake in Castlemaine Gold'elds Limited (CGT) with its takeover o'er. At the close of its takeover bid on Aug 31, LionGold had received acceptance for 264.85mil CGT shares or 97.68% of the issued and paid'up share capital of CGT, subject to Australian CGT's share registrar's 'nal audit.

Hi'P International (S$0.905) 
Plump $300m in Nantong operations  
Hi'P International Limited has entered into an investment agreement with the Nantong Economic & Technological Development Area (Netda) administrative committee, in China's Jiangsu province. Under the agreement, Hi'P is to set up a production plant to manufacture and sell its electrical components in Netda. A plot of 3.59mil sq  ft south of Hexing Road and west of Dong Fang Road at the Precision Machinery Industrial Park of Netda has been set aside for it. The land, with 50'year rights, has to be acquired through an open tender at a price above its current reserve price of 35.67 yuan (S$7) per sq ft.

Phase 1 of the project will occupy 1.08mil sq  ft  of the designated area, with an additional 265,502.60 sq  ft available for procurement. A total of 2.22mil sq  ft willalso be reserved for Phase 2 and 3 of the project until end October 2014 and 2016 respectively.

It will establish Hi'P (Nantong) Technology Co Ltd with a registered capital of US$33mil and total investment of US$99mil to deal with the acquisition and construction of the building and its facilities. Hi'P estimates an investment of $300mil for Phase 1 alone. External borrowings of $132mil will be utilised, on top of the existing bank borrowings of $168mil. Upon completion of the proposed investment, taking into account external borrowings, net gearing ratio is expected to be 0.32.

Source: The Business Times

Source: AmFraser