K1 Ventures

(13-09-2012, 10:40 PM)Jacmar Wrote: This still don't explain why he puts in the clause to return the money and not accept the 76-65=12% for those stupid enough to offer their shares.

As d.o.g. & cif5000 have mentioned, they can resort to other means of cashing out once they have hit the 90% mark. If anything below that, they can only use dividend payment. Any other means of IPTs have to go through EGM (not sure about the details).

Put into perspective, if they had insisted on the 12%, they would get 260m shares. At the same dividend payment of 0.5c each, this translate to only S$1.3m - split among Green, Keppel & BV Group. They still need to pay out fee for the offering so net-net, the payable is lesser. Sure, they can pay out more but they also lose out as more is being paid to the other shareholders. Thus, it will be best for those to hit 90% and get the whole cake for themselves.

Such a conditional offering is often common in takeover/privatisation bids

VOLUNTARY CONDITIONAL CASH OFFER FOR K1 VENTURES LIMITED - CLOSE OF OFFER

http://info.sgx.com/webcorannc.nsf/Annou...endocument

As the aggregate number of Offer Shares represented by valid acceptances received by the Offeror, when taken together with the total number of Shares owned, controlled or agreed to be acquired by the Offeror and its Concert Parties, as at 5.30 p.m. on the Final Closing Date did not exceed 90% of Shares as at the Final Closing Date, the Offer has not become unconditional and the Offer has accordingly lapsed.

Minority shareholder won this round, successfully lapsed the offer.

Will there be a repeat of what happened to the price of Neratel, after the buyout by STE failed, here?

confirm Offer lapsed...
they only manage a 1.53% incremental acceptance over the Aug-29's level of acceptance.

At Start of Offer(Jun28): the OFFERORs controlled 1,350,469,990 shrs (62.36% of K1 IssShrs)
total acceptances received over entire offer period (Jun28-Sep14) = 330.392m shrs (+15.26% of K1 IssShrs)
At final Offer Close: AGGREGATE of shrs they already owned + All Acceptances = 1,680,862,338 shares (77.62% of K1 IssShrs)
they missed the 90% mark by 268.19m shrs (12.38% of K1 IssShrs)

NB: Cumulative vols of daily shares traded (Jun28-Sep14) = 124.324m shrs (5.74% of K1 Iss Shrs)

But should another "attack" be launched in a year or two time,
outcome likely to be completely different... unless there's a core group of minorities already in place, with entrenched > 10% interests.

thks to all those who contributed in one way or another, to prevent K1 from being delisted *salute*

(15-09-2012, 12:34 AM)VestedInterest Wrote: Will there be a repeat of what happened to the price of Neratel, after the buyout by STE failed, here?

Price is holding up...unfortunate for the opportunists.

(17-09-2012, 11:36 AM)cif5000 Wrote:

(15-09-2012, 12:34 AM)VestedInterest Wrote: Will there be a repeat of what happened to the price of Neratel, after the buyout by STE failed, here?

Price is holding up...unfortunate for the opportunists.

I used to be vested, so I did take a closer relook over the weekends to see if there're any Neratel-like opportunities...

Looking just at their Financial statements, a very big difference.

For Neratel, the key attraction (to me) was High Cash (~15ct/share), negligible debts plus the past 5 years' track record of paying 3-4cts dividend ie. Yield = 7.5% to 10% @ 40ct. Biz-wise, definitely not a growth stock, but some potential for short term growth due to their new MENA customer rights.

Looks like a rather safe bet for an opportunist when prices plunged to 39.5ct to 40ct after the Scheme Offer failed. In the worst case, just hold for longer term for the yield.

As for K1, for FY12, I see Debts more than 3x Cash. Div = 0.5ct ; EPS = 0.55ct. The Yield of <4% is not very attractive. Neither does it look like a Growth Stock, since they're paying almost the entire EPS out as DPS ie. not retaining for Growth. By nature of their biz ie. Ventures (fm their name), it makes sense not to hold too much cash (unless looking for new assets / biz to acquire) + use of Debts (to max. returns), I'd guess the key attraction would be on the discount to NAV (or RNAV).

Although Discount to NAV was ~20% and could be a lot more if they could find interested buyers (which will take time) to their assets, I decided to KIV 1st as I didn't get excited enough to do more research....

Neratel is an operating business while K1 is an investment holding company.

The latter's financial statements have little reliability. It is nothing but a consolidation of its own fund and Helm Holdings (which had been consolidated since it is more than 80% owned by K1).

K1 should be valued based on a SOTP of its 5 different investment holdings.

K1 Ventures business model is more like MIIF (or GIL) rather than Neratel. We are paying the Manager to invest in unlisted companies and products to generate cash-flow and capital appreciation. The Fund's financial statement doesn't reflect much operating data or the financial health of the underlying investments (with the exception of Helm). It just shows how much distributions the Fund is getting from these assets and the valuation of the marked to market assets (like its listed equities).

(Not Vested)

On 5 December 2012, Freeport-McMoRan Copper & Gold Inc. (FCX) announced it will acquire MMR for $14.75 cash plus 1.15 Ultra-Deep Royalty Trust Units per MMR share.

k1 owns 2,309,000 common shares of McMoran Exloration (MMR). Assume that 1.15 Ultra-Deep Royalty Trust Unit worth only $1.5 per unit. k1 will receive about $37 million USD. That's about $44 million SGD.

DMG wrote a short write up on K1 Ventures today:

http://www.remisiers.org/cms_images/rese...atters.pdf

(Not Vested)