We are initiating coverage on SPH REIT with a HOLD call and target price of S$ 0.97. SPH REIT offers investors a unique exposure to the retail and healthcare services industry in Singapore, backed by a portfolio of landmark high quality commercial assets, and a reputable and strong sponsor, SPH. We believe that the REIT will provide a stable yield platform with growth potential from organic and inorganic means. FY13-14F yields of 5.4%-5.6% while attractive given its stability is noted to be currently at a premium to other retail-focused S-REITs, which currently offer yields in the range of 6.1%-6.5%.

In a move that would increase its reserves by 80%, Interra is acquiring an Indonesian company for US$78.5m. The company, PT Benakat Barat Petroleum (BBP), holds all the rights to explore and develop the Benakat Barat field in South Sumatra. It holds proven and probable (2P) reserves of 19.9 million barrels of oil, according to a May 2010 reserve report. Interra now has 25 million barrels in reserves. The transaction will be 80% paid for with cash, financed through bank borrowings; the remaining 20% will be funded by new shares issued at 45.91 cents - the weighted average price for trades done yesterday. The Benakat Barat field is adjacent to the Tanjung Miring Timur (TMT) field, in which Interra holds full participating interest. The contract to develop the Benakat Barat field was assigned in 2009 for 15 years.

Tat Hong Holdingsis embarking on a programme to consolidate and optimise its Singapore operations and has secured a 22-year lease from Jurong Town Corporation for a 16,100 sq m plot of industrial land at Tuas South Street 10. The consolidation of operations will free up one of its lease-hold properties, at 11 Gul Crescent, which the Group intends to divest through a public tender. Depending on the final sale price and the completion date, the Group is expected to recognise a gain on the divestment of 11 Gul Crescent in the financial year ending 31 March 2014. The Group currently also operates out of five other sites in the western part of Singapore.

Cordlife Group is acquiring a 19.92% interest in StemLife Berhad, a company listed on Bursa Malaysia, for RM29.58m to expand its overseas operations. The transaction will enlarge the Group's geographical footprint in Asia and extend the Group's reach of complementary services such as umbilical cord tissue banking. The aggregate consideration for the acquisition will, unless elected by Cordlife to pay fully in cash, be satisfied via the issuance of 8m new shares in Cordlife at an issue price of S$1.30 per share and cash payment of RM2.85m.

Global Logistic Properties will sell two wholly-owned properties in Japan to GLP J-REIT. The properties comprise a total gross floor area of 126,000 sqm and the sale price of JPY28.5 bn (US$2871m) represents a 1% premium to the properties' newly appraised value as of 30 June 2013. Completion of transaction is targeted to take place in March 2014. Net cash proceeds from the sale are estimated to be approximately JPY13.6 bn (US$137m). GLP plans to hedge the proceeds and intends to reinvest the capital to maintain its 15% interest in the J-REIT as well as developments in China, Japan and Brazil.

Separately, GLP Japan Income Partners I will sell seven properties to GLP J-REIT for approximately JPY27.5 bn (US$2771m), which is in line with the properties' newly appraised value as of 30 June 2013. GLP owns a 33.3% stake in GLP Japan Income Partners I. The properties have generated a cumulative net levered IRR in excess of 46% for investors in GLP Japan Income Partners I, before management fees and promotes, since they were acquired in February 2012. Completion of transaction is targeted to take place in October 2013. Net cash proceeds from the sale are estimated to be approximately JPY9 bn (US$91m), with GLP's share at JPY3 bn (US$30m). GLP plans to hedge the proceeds and intends to reinvest the capital to maintain its 15% interest in the J-REIT as well as developments in China, Japan and Brazil.

Acma is buying into a Russian private engineering company with strong political connections, in a deal which could enable it to regain a strategic foothold in a market where it used to have a strong presence. It would issue shares to buy a 30% stake in Russia's Avanguard 500 (AVG). The deal involves a guarantee of at least US$10m in total pre-tax profit to Acma for the next three years. The purchase consideration of US$3m will be paid via the issuance of 123.1m new Acma shares at 3.11 Singapore cents each, representing 2.93% of Acma's issued and paid-up capital. AVG, incorporated in Russia on Dec 8, 2009, is mainly engaged in engineering and engineering-related construction. Its chairman Igor Alexandrovich Putin, a Russian businessman and politician, is a first cousin of the country's president Vladimir Putin.

A proposed $590m collective sale of Thomson View Condominium is scuppered after the High Court found that its marketing agent's offer of more than $548,000 in incentive payments to four owners to get a requisite 80% majority amounted to bad faith. Wee Hur has entered into a conditional contract for the collective purchase of all strata units and the common property of Thomson View back in September 2012.

LionGold has signed an MOU with CBMI Construction, a subsidiary of China's State-owned engineering contractor giant, SINOMA Group. The arrangement would also allow LionGold to leverage on CBMI's technical capabilities in its efforts to bring its gold mining projects to production as well as to acquire new gold mining projects. Also, as part of the arrangement, CBMI would assist, where possible, project financing for LionGold's gold mining projects on terms to be agreed.

CH Offshore has entered into two bareboat charters with a third party for a period of three years each, with an option for the Charterer to purchase the vessels.

After several months of outperforming its Asian peers, Singapore's PMI headed in the opposite direction last month, falling to 50.5 from 51.8 in July, below market expectation of a slight rise, and followed news on Monday that China, Taiwan and South Korea all posted higher manufacturing PMIs. PMI fell because of a slowdown in production, as manufacturers drew down inventories that have been building up over the last few months. The overall new export orders sub-index, however, rose to 53.4, its highest reading since April 2011. Demand for electronic exports was especially strong. The electronics new export orders sub-index rose to 54, its highest reading since May 2011, pushing the electronics sector PMI to a three-month high of 51.3.

A hotel site on Havelock Road has been triggered from the Government Land Sales' Reserve List, after the URA received a commitment from a developer to bid at least $18.0m for the plot. The 60-year leasehold plot, which measures about 16,535.5 sq ft, has maximum permissible gross floor area of about 23,088.6 sq ft. Based on the trigger price of $18.0m, this translates to about $780 psf ppr.

US stocks rose modestly but eased off early session high even as the August ISM manufacturing index increased to 55.7 (consensus 54) from 55.4 the previous month. The reading is also the strongest since June 2011. Stocks back tracked after US President won endorsement from the top 2 Republicans in the House for action against Syria. Asian bourses are starting the mid-week session lower, reacting to higher oil price on concerns about a strike on Syria.

Source: DBSV