Singapore Press Holdings (SPH)

[2V.]

Yes! Thats the point. Its the first catalyst after so many years, Im looking for opportunites to add more on price weaknesses.

How does SPH shareholder gets benefits from a SPH REIT if he has not invested in it?

To answer you, let me quote an example Freight Links which has Sabana REIT units. As a result of more professional team managing the REIT, Freight Links enjoy better profitability. Does this translate to better dividend? As I am not a shareholder, can Freight Links shareholders enlighten me?

I agree that all this activity is not adding anything to its core business but is adding to its future business.

Your investment has not gone down the drain. SPH yields a reasonable dividend.

(Vested)

[CityFarmer]

Singapore Press Holdings Ltd wishes to announce that its whollyowned subsidiary, SPH Interactive Pte Ltd, has subscribed for 865,703 new preference shares in Chope Group Pte Ltd at the consideration of S$1,810,000.

http://info.sgx.com/webcoranncatth.nsf/V...F003541BE/$file/SGXAnnChope15Mar13.pdf?openelement

With google, the Chope Group is an exciting start-up company with the mission of connecting restaurants and diners in Singapore through online reservations.

I am not very sure the rational of acquiring this company? Probably to integrate with online advert, and provides seamless service to viewers?

[a74henry]

I pray that SPH did not overpay.

I am not familiar with IT companies.
How is an investment in Chope Group Pte Ltd going to be yield accretive to shareholders?

[CityFarmer]

I pray that SPH did not overpay.

I am not familiar with IT companies.
How is an investment in Chope Group Pte Ltd going to be yield accretive to shareholders?

S$1.8 mil will never make a difference for SPH, even it is overpaid.

[palantir]

SingTel bought HungryGoWhere. So SPH also playing along this business by buying into Chope

[LionFlyer]

I have some doubts about Chope's business case. At the end of the day, is that restaurant so hot that I die die must get a place there(using the app to get some minor advantage in getting a table as opposed to making call)?

For example, I tried to book Wah Lok last Friday but failed to get a reservation but decided to go near by for dim sum (raffles city area got plenty, next door already got Asia Grand, Hai Tian Lo, Royal China)

Anyway, their track record in the online business is pretty spotty. HWZ is good, but I am not sure it contributes significantly to their revenue.. and last time they tried Red Nano. That failed miserably. Maybe just keep to doing property might be a better investment.

[CityFarmer]

I read the article titled "REIT plan heralds boost for property division" of The Edge, which highlight the recent SPH's REIT listing.

IMO, the article touch on everything, but tell nothing. The major part of the article focuses on capital reduction/distribution, but it also touches on capital recycle at the last part of the article? The number presented seems fallacious too IMO

On the topic of capital distribution, it estimates the IPO size base on book value (cost less depreciation), rather the up-to-date MV. Book value of 1.74 bil versus MV of 3 bil, it is close to 100% difference.

[snowcap]

A REIT is beneficial for shareholders, the banks and the SGX.
SPH will realise the market value of its properties and give SPH another income generator on top of its events and media.

Banks get to earn a fee for arranging the REIT.

SGX gets to have an additional counter that pays listing fees, etc.

Blue Chips including SPH taking a correction mode today.

I agreed partially.

"Banks get to earn a fee for arranging the REIT."
Yes, who will pay for it? SPH shareholder will. How much? Base on very conservative underwriting fee of 1%, it is more than S$30 mil.

"SGX gets to have an additional counter that pays listing fees, etc. "
Yes, who will pay for it? SPH shareholder will pay indirectly, by owning the REIT. How much? Well, it can easily up to a mil per year.

"SPH will realise the market value of its properties and give SPH another income generator on top of its events and media."
Partially agree. The REIT will not give another income generator, but will replace the income from existing properties segment. In fact the income will be less, depending on the stake retained.

SPH will pay two of the three points, and get less from the remaining point. So do you think it is still beneficial for SPH shareholder?

My simple view: Divesting properties into a REIT involves fees from #1 and #2, but if the capital gains from the bubbly valuation is high enough, it will more than offset the fees. Example: if I invested in a $1m property and the price goes up to $2m, I am not going to complain of 1% agent commission ($20k) or 4% Seller Stamp Duty ($80k). After all, I made some $900k. Assumption is that market valuations are toppish and further upside is limited. Which given the govt cooling measures, is very realistic.

Vested in SPH

[CityFarmer]

A REIT is beneficial for shareholders, the banks and the SGX.
SPH will realise the market value of its properties and give SPH another income generator on top of its events and media.

Banks get to earn a fee for arranging the REIT.

SGX gets to have an additional counter that pays listing fees, etc.

Blue Chips including SPH taking a correction mode today.

I agreed partially.

"Banks get to earn a fee for arranging the REIT."
Yes, who will pay for it? SPH shareholder will. How much? Base on very conservative underwriting fee of 1%, it is more than S$30 mil.

"SGX gets to have an additional counter that pays listing fees, etc. "
Yes, who will pay for it? SPH shareholder will pay indirectly, by owning the REIT. How much? Well, it can easily up to a mil per year.

"SPH will realise the market value of its properties and give SPH another income generator on top of its events and media."
Partially agree. The REIT will not give another income generator, but will replace the income from existing properties segment. In fact the income will be less, depending on the stake retained.

SPH will pay two of the three points, and get less from the remaining point. So do you think it is still beneficial for SPH shareholder?

My simple view: Divesting properties into a REIT involves fees from #1 and #2, but if the capital gains from the bubbly valuation is high enough, it will more than offset the fees. Example: if I invested in a $1m property and the price goes up to $2m, I am not going to complain of 1% agent commission ($20k) or 4% Seller Stamp Duty ($80k). After all, I made some $900k. Assumption is that market valuations are toppish and further upside is limited. Which given the govt cooling measures, is very realistic.

Vested in SPH

From the perspective of capital reduction i.e. realizes assets value and distributes to shareholders, the view is realistic.

[a74henry]

Having SPH realise these assets and distributing to shareholders is possible. Look at Keppel Corp which distributed K-Green and SIA which distributed SATs to its shareholders.