Olam International

(22-12-2012, 12:54 PM)Stocker Wrote: For bonds , no need at all.

For the warrants, may be needed...

Olam's 7% p.a. Perpetual Bonds have had a rather steady week, gradually increasing in price to just over S$ 83 at the week's end. Volumes remain low. This corresponds to a yield of ~ 8.4% p.a.

Advice from my bank remains hold - don't buy any more Perpetuals.

Vested (in the Perpetuals)

(22-12-2012, 11:54 AM)CityFarmer Wrote:

(22-12-2012, 01:09 AM)specuvestor Wrote: Any changes to the "creeping rule" in the new regime in Nov 2012?

"creeping rule" as major shareholder creeping via placement without seeking approval from shareholders?

I did not go into detail, but worth to take a look...

creeping rule is that major shareholders acquire <1% shares in previous 6 months without triggering GO

(23-12-2012, 01:10 AM)specuvestor Wrote:

(22-12-2012, 11:54 AM)CityFarmer Wrote:

(22-12-2012, 01:09 AM)specuvestor Wrote: Any changes to the "creeping rule" in the new regime in Nov 2012?

"creeping rule" as major shareholder creeping via placement without seeking approval from shareholders?

I did not go into detail, but worth to take a look...

creeping rule is that major shareholders acquire <1% shares in previous 6 months without triggering GO

oh.. IMO, the rule is necessary and should remain relevant. It gives room for corporate action, since major shareholder may hold directorship in board.

Anyway, for major shareholder of 30% to creep till controlling 50%, it needs more than 10 years, which is non-practical IMO

The rights issue circular is out. Despite the Kewelram family publicly saying that they will support the rights issue, and a Straits Times article assuming Sunny Verghese will take up his share of the rights, both parties are conspicuously absent from the list of undertaking shareholders. Only Temasek, in the form of its subsidiaries Aranda and Breedens, has given an undertaking to take up its share of the rights. Aranda has also underwritten the entire rights issue.

We will have to wait until the rights issue is over, and announcements are made on changes in deemed interest, to see whether Sunny Verghese and the Kewelram family have put their money where their mouths are, or whether the rights issue has all along been merely a disguised placement to Temasek.

The warrants and new shares issued does not need additional approval from shareholder, it is pursuant to a resolution in previous AGM.

"The issue of the Warrants and the New Shares is proposed to be made pursuant to the share issue mandate approved by Shareholders of the Company at the Company’s annual general meeting held on 31 October 2012. Consequently, a Shareholders’ meeting need not be convened for the purposes of approving the issue of the Warrants and the New Shares."

The only resolution is the payment of sub-underwriting commission to Temasek.

What if the motion is not carried?

Are the bonds tradeable over the exchange? These guys came up with a magical odd number in the rights issue to hook the retailers who will have difficulties disposing it after subscription.

Temasek raised its interst in Olam to 19%.

It seems that Temasek is determined to destroy Muddy Water if it has not covered its shorts yet.

Isn't temasek limited by their shareholding cannot exceed 30% including the warrants?

Heya, been following the forum but not created an account before this...

Got a question that my friends can't answer so I'm trying it here..

People are saying Olam's bond yield is high about >8%.. however, these are sort of academic projection based on formulas and perceived value of the warrants.

From a business point of view, I feel that this is not a bad deal. For the next few quarters until the bond matures, Olam is effectively paying only 6.75% interest. This is similar to what they are paying now (or might be even lower than their bank lines). The only time when they will feel a pinch is when the bond matures, and they need to cough back US$750mil, about $40mil more than what they actually collected. However, I feel the management can actually do a shares placement (depending on the market) to get money from the shareholders to "repay" them. It won't cost them as much as what people will think.

Is this a reasonable view? Of course, there's opportunity costs etc but in real terms, Olam is not losing that much.

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(27-12-2012, 03:35 PM)d.o.g. Wrote: The rights issue circular is out. Despite the Kewelram family publicly saying that they will support the rights issue, and a Straits Times article assuming Sunny Verghese will take up his share of the rights, both parties are conspicuously absent from the list of undertaking shareholders. Only Temasek, in the form of its subsidiaries Aranda and Breedens, has given an undertaking to take up its share of the rights. Aranda has also underwritten the entire rights issue.

We will have to wait until the rights issue is over, and announcements are made on changes in deemed interest, to see whether Sunny Verghese and the Kewelram family have put their money where their mouths are, or whether the rights issue has all along been merely a disguised placement to Temasek.

I thought for this circular it is actually about granting Aranda underwriting fees.. There isn't a requirement for Sunny or Kewelram family to state their undertaking interest here. Also, Temasek is aggressively buying shares now, if it is really a disguised placement to Temasek, Temasek won't need to go through so much trouble to get even more shares from the market...