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Stamford Land
16-07-2011, 10:38 AM,
Post: #31
RE: Stamford Land
I noticed that Morph Investments had crept into top 20 shareholders this year.
They were not in the top 20 list last year.


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16-07-2011, 11:14 AM, (This post was last modified: 16-07-2011, 11:26 AM by yeokiwi.)
Post: #32
RE: Stamford Land
Morph Investments should be a private fund manager. Ha, actually, I do not know them well. But, they always appear as top 20 shareholders of some of the value stocks in SGX.

Eg.
Singapura Finance
UIS
UOL
Haw Par
Engro
Hotel Plaza
Isetan
Guthrie GTS
...

and recently, it appears in LHT, Metro, Stamford Land and Superbowl..

Of course, they also hold some not so fantastic stocks like intraco, EMS energy etc.
But, in general, they are value-oriented and so, it is good to see them appearing on those stocks that I am monitoring..hehe

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03-10-2011, 06:43 PM,
Post: #33
RE: Stamford Land
STAMFORD ENTERS INTO MOU FOR THE PROPOSED SALE AND LEASEBACK
OF THREE OF STAMFORD’S HOTEL PROPERTIES


- MOU entered into with prospective purchaser, for the proposed sale and lease-back of three of Stamford’s hotel properties.
- the three hotel properties with an indicative purchase consideration of AUD316 million, will continue to be managed and operated by Stamford under long-term lease-back arrangements.

http://info.sgx.com/webcoranncatth.nsf/V...penelement [Press Release]

Stamford Land looks set to report a S$212 million gain from this transaction. This compares well with its current market capitalization of $397.4 million.

Any thoughts on this Tonylim ?

(Not Vested)
Disclaimer: Please feel free to correct any error in my post. I am not liable for anything. Do your own research and analysis. I do NOT give buy or sell calls and stock tips. Buy and sell at your risk. I am not a qualified financial adviser so I do not give any advice. The postings reflects my own personal thoughts which may or may not be accurate.

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03-10-2011, 07:10 PM,
Post: #34
RE: Stamford Land
That explains why Ow Chio Kiat was not actively buying the share for the past few weeks.
Coupled with the payment from Stamford residences and reynell terraces and if this sale and leaseback is successful, stamford land will be flooded with cash.


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04-10-2011, 09:28 AM,
Post: #35
RE: Stamford Land
probably another financial engineering at work.

it also depends on what is the lease price. Was the valuation derived from high lease rate?

If the lease price is high, I don't think any meaningful part of the proceed of 400+ million can be distributed because the company probably need it to repay the debt and pay the lease.

Another question is what the company is going to do with the money.

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04-10-2011, 01:09 PM, (This post was last modified: 04-10-2011, 01:10 PM by freedom.)
Post: #36
RE: Stamford Land
(04-10-2011, 12:11 PM)tonylim Wrote: Believe the prospective buyer is not in the same industry, they could be PE investors. If they expect a return of 8% , it is win win for both buyer and seller. SL borrowing costs should be around 6.5 % so the leased back cost for SL is 1.5% more than the borrowing costs. More advantage to SL.

lease cost higher than borrowing cost, it is more advantage? let's see.

original operating expense for the 3 hotels is borrowing cost + hotel operation cost

operating expense for the 3 hotels after sale and lease back is lease cost + hotel operation cost

but, normally your borrowing will be lower than asset value, so borrowing cost is much lower than lease cost, therefore, original operating expense is much lower than new operating expense.

of course, the benefit is that you get part of the asset valuation in advance.

so the sale and lease back works exactly similar to borrowing, plus you get some cash in advance. but with borrowing, eventually, you still own the asset; with sale and lease back, you pay lease cost, eventually, you do not own the asset. which is more advantageous?

it all boils down to what is the lease cost and is the asset valuation going to increase in the future.

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04-10-2011, 01:31 PM, (This post was last modified: 04-10-2011, 01:32 PM by freedom.)
Post: #37
RE: Stamford Land
what means to the majority owners of the company is not necessarily meaningful to minority shareholders.

e.g. maybe the owners see other opportunity rather than hotel business and they need capital. so they do a sale and lease back. the majority owners get what they want (new business), but what do minority shareholders get? uncertainty with the new business and less profitable original business if lease cost is high and loss of potential valuable assets.

but if that's the case, normally the owners could sweeten the whole process by distributing part of the proceed to minority shareholders.

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04-10-2011, 07:30 PM, (This post was last modified: 04-10-2011, 07:30 PM by Contrarian.)
Post: #38
RE: Stamford Land
> so they do a sale and lease back. the majority owners get what they want (new business), but what do minority shareholders get? uncertainty with the new
> business and less profitable original business if lease cost is high and loss of potential valuable assets

This is a fantastic transaction at the right time. IF the buyers do NOT pull out, then the $$$ is really very useful...

OCK is really an investment savvy guy...
> so they do a sale and lease back. the majority owners get what they want (new business), but what do minority shareholders get? uncertainty with the new
> business and less profitable original business if lease cost is high and loss of potential valuable assets

This is a fantastic transaction at the right time. IF the buyers do NOT pull out, then the $$$ is really very useful...

OCK is really an investment savvy guy...

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04-10-2011, 08:15 PM,
Post: #39
RE: Stamford Land
(04-10-2011, 07:30 PM)Contrarian Wrote: OCK is really an investment savvy guy...

OCK treated minority shareholders very well too judging from the history of dividend payment by stamford land, cougar logistics and Singapore Shipping Corp.

I will expect a good special dividend if this sale and lease goes through.

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05-10-2011, 11:19 PM,
Post: #40
RE: Stamford Land
I wonder why it is merely an MOU. Can the buyer back out at the last minute? There has not been a corresponding announcement in the SGX or Australia regarding this MOU. Hence the buyer is probably an unlisted fund which doesn't have to announce on SGX or the Oz bourse. Am not too sure why someone would want to pay for the hotels at a huge premium to the book value in this kind of financial maelstrom. Unless the rental return is high enough for them- perhaps 10% per annum (purely speculating). Anyone any comments?

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