Sheng Siong Group

[CityFarmer]

As for the pre-IPO behaviours, you are buying the company on an as-is basis as stated in the prospectus @ the offered price. What the owners did before that to extract value was not particularly relevant.

I was asked a question. Why taking risk as founding investors, when passive investors (i.e. the OPMIs) bear much lesser risks? Well, founders normally will and should enjoy out-sized reward, over the OPMI for the success of the business, with a prerequisite of full disclosure. In this case, I suppose we have full disclosure.

As for alignment of interest - a lot has been said but I don't think we ever would have a situation where a majority owner would work to satisfy the 30% who own shares in his company. Currently the Lims are running business well and the group today is doing better than 3-4 years ago, and is paying out most of the earnings as dividends rather than retaining the cash to do some crazy levering into a mega property business. I see that as enough alignment - they did structure a comps package to have first dibs but would you rather they pay themselves options? 4 mil each? no divs?

I agree with your view. Is the reward justified with the contribution from the top 4 of the company? Well, I am convinced it is worth the money, with the company performance so far.

(vested)