Amara Holdings

[cyclone]

Amara Unveils Luxurious Residential Development, 10 Evelyn, in Prime District 11

Highlights :
* Freehold development consisting 56 units of 1-bedroom, 2-bedroom and penthouses with 3 bedrooms
* Prime location with Newton and Novena MRT stations in close proximity
* Modern luxury living with intuitive spaces, expected for completion in early 2020

More details in http://infopub.sgx.com/FileOpen/Amara_Un...eID=528406

[¯|_(ツ)_/¯]

Amara@37
1HFY2021 Result - NP turning positive
https://links.sgx.com/FileOpen/Amara_1H2...eID=678000

https://drive.google.com/open?id=1zhkIIE...X66ISz3iXy

Stay home and stay safe, everyone.

[brattzz]

https://links.sgx.com/FileOpen/Amara_Hol...eID=762733

Teo Family may be selling to buyer...

The Board wishes to announce that it has on 17 June 2023 received a written notification from Mr Albert
Teo Hock Chuan and Ms Susan Teo Geok Tin that they and certain of their family members are currently
engaged in confidential discussions with a third party in relation to a possible transaction involving the
Company, which may or may not lead to an offer for the shares of the Company.

The discussions are ongoing and there is no certainty or assurance that such discussions will progress
beyond the current stage, or that any definitive agreements will be entered into or that any transaction
will materialise as a result of such discussions.

[weijian]

Based on AR22, the entire Teo clan already owns ~60+% of the company. So Dymon Asia's 30% stake is mainly just to buy out the minorities and possibility some of the members in the Teo clan. This is probably also 1 of the few MBOs participated by local PE that is buying out an "asset heavy" company?

For context, Amara's balance sheet are mainly made up of 2 types - Investment properties (small retail/office mixed developments in Spore/China) and PPE (AMARA hotels in Spore/China/Thailand), making up ~103% and 59% of its equity. To balance, it is ~75% geared to finance these properties together with some boutique residential development in Spore. The investment properties are at fair value and so there is no hidden value. But the AMARA hotels are at cost less depreciation and although they are on leases, they should probably be undervalued on the balance sheet. So the 60cent offer (or ~90% of NAV of 68cents as of end AR22) while looks decent, will be undervaluing the hotels and the AMARA brand.

But for Teo clan, I guess the bottom line is that you can do away with annual remuneration (that doesn't even reveal the names) in the fear of having your talented family members been poached away. And also dispense away with really independent directors.

Teo family, Dymon Asia consortium launches bid to take Amara private at S$0.60 a share

The offer price is final and represents a premium of 53.8 per cent over Amara’s share price of S$0.39 on Jun 15, before the company announced that its key shareholders were in talks over a possible transaction. Amara most recently transacted at S$0.46 before a trading halt was called on Nov 10.

Amethyst is 36.2 per cent-owned by First Security Pte Ltd (FSPL), a company in turn owned by Albert Teo and his siblings Susan Teo and Teo Kwee Chuan – who are Amara’s executive director and property division director respectively.

Concordia United, an investment vehicle under Dymon Asia Private Equity, holds another 30.3 per cent stake in Amethyst.

Other shareholders of the offeror include Albertsons Capital – jointly owned by Albert Teo and his daughter Teo Shao-Lynn, Dawn – and Corinne Teo, another sibling of the chief executive who is the group’s quality and systems manager.

https://www.businesstimes.com.sg/compani...s060-share

Amara disagrees with ex-ID over what he calls unresolved issues
https://www.businesstimes.com.sg/propert...ved-issues

[ghchua]

Hi weijian,

Though the offer price represents more than 50% premium over the last undisturbed share price, I still feel that it undervalues the company. If you revalue those PPE, I am quite sure that its RNAV will be well above $1 per share. This is considering the fact that Amara Signature Shanghai is quite new.

Remember that the new compulsory acquisition rule require the offeror to acquire 90% or more of those shares that they do not own. It remains to be seen whether they can garner enough shares from minorities to execute compulsory acquisition and delist the company.

[weijian]

hi ghchua,

If the hotel is located in the right place, the existence of one will generally uplift the surrounding precinct. As more amenities and infrastructure appear over time, the precinct gets more desirable and its value will rise. For PPE (their hotels), they are recorded at cost less depreciation on BS. So I thought the older a hotel, the better the chance for hidden value as desirability of its location has increased over time AND there is more recorded depreciation.

Along the same lines, any hotel that is newer --> recorded less depreciation and less time for land appreciation --> lower quantum of upwards revaluation if a sub-sale actually occurs.

Of course, I am conveniently ignoring that hotels need reno/upgrades to keep its competitiveness when I m doing this comparison.

I wonder what is Dymon Asia's end game? There is not a lot of operational improvements you can effect onto hotel ops. One can value add by building up the brand but that is going to take a lot of capital (and a lot more time). Amara's balance sheet is also quite leveraged up and the financial engineering game is limited. Is Dymon Asia a mid term partner providing some form of "bridging equity loan" where Teo clan will eventually buy them out again? Or this partnership will eventually sell off their small hotel portfolio to 1 of the major hospitality brands and/or their REITs?

[ghchua]

Hi weijian,

Just to clarify that the land that Amara Signature Shanghai sits on is not new. They took quite sometime to build the hotel on that plot of land, together with 100 AM Shanghai.

I guess Dymon Asia would have their own end game which we would not be able to know. Yes, we can try to guess but ultimately, there is not much information to work on.

But they are definitely looking to make profit out of this deal, otherwise why bother?

[weijian]

So it seems like Dymon Asia is selling out their ~30% stake in the prior takeover for about 50% premium to the prior takeover just 1.5years ago. That is an excellent return and probably even much better after been juiced up by leverage.

As per previous IFA report, the RNAV of the company was ~1.247 (end June2023) with the 2023 60cents offer deemed "fair and reasonable". The current Offerer seems to have secured a couple of the bigger OPMIs' support and has already crossed 90%. So I suppose delisting is already guaranteed.

Voluntary Conditional General Offer for Amara

• Offer Price of S$0.895 per Share in cash provides an exit opportunity at an attractive premium, valuing Amara at about S$514.6 million
• Offer Price of S$0.895 per Share in cash is final
• The Offeror has secured irrevocable undertakings representing approximately 90.58% of the total number of Shares

The shareholders of the Offeror are: (1) Shorea HwaHong Newfields VCC (acting for the purpose of Shorea HwaHong Newfields Investors3), a variable capital company sponsored by entities related to Hwa Hong Corporation Pte. Ltd. and the Newfields group of companies (“Newfields Group”), and managed by Shorea Advisors Pte. Ltd., a subsidiary of Shorea Capital Pte. Ltd. (“Shorea Capital”); (2) Winteam Investment Pte. Ltd., an investment holding company which is a wholly-owned subsidiary of Wing Tai Holdings Limited; and (3) Albertsons Capital Pte. Ltd., whose shareholders are Albert Teo, Amara’s Chairman, Executive Director and Chief Executive Officer, and Dawn Teo, Chief Operating Officer of Amara.

https://links.sgx.com/FileOpen/Press_Rel...eID=842945

[weijian]

I thought it would be interesting to contrast the 2 IFA reports since they are just 1.5years apart. And despite a 50% difference in the offer price, both came with the same conclusion while using a different range of values for upper/low valuation.

"The language looks pretty liberal", is all I can say (so that I keep myself out of libel). The odds are overwhelmingly stacked against the OPMIs but then again, markets are reflexive - Poor odds that are well known may create the conditions for big payoffs, making the expected result (low odds multiply by big payoff) profitable.

IFA (W CAPITAL MARKETS PTE. LTD) conclusion on 2025's 89.5cents offer: fair and reasonable

On the other hand, while the EV/EBITDA ratios of the Comparable Companies has a narrower spread, ranging from between 9.8 times and 23.4 times, the implied valuation of the Group based on the mean or median EV/EBITDA ratios of the Comparable Companies would yield a lower valuation result than the Group’s NAV. Hence, we have not used the EV/EBITDA valuation parameter.

For the upper bound of the valuation range for the Shares, we have considered the RNAV per Share of the Company as at 31 December 2024 of S$1.411 per Share and the median P/RNAV ratio of the Precedent Property Privatisation Transactions of 0.680 times.

For the lower bound of the valuation range for the Shares, we have considered the NAV per Share of the Group as at 31 December 2024 of S$0.673 per Share to be a base value. However, using this as a base value will result in a range of estimated value of the Shares to be fairly wide. As such, we have considered the VWAP of the Shares of S$0.888 per Share for the period from the Offer Announcement Date up to the Latest Practicable Date, which is at a premium to the NAV per Share as at 31 December 2024, instead for the lower bound of the valuation range.

Based on the above, the estimated value of the Shares would be between S$0.888 and S$0.959 per Share. The Offer Price of S$0.895 is within the estimated range of values of between of S$0.888 and S$0.959 per Share.

2025 IFA report: https://links.sgx.com/FileOpen/Amara_Off...eID=847028

------------------------------

IFA (XANDAR CAPITAL PTE. LTD) conclusion on 2023's 60cents offer: fair and reasonable

Based the mean and median EV/EBITDA ratios of the Comparable Companies and the Group’s EBITDA of approximately S$34.4 million for LTM30Jun2023, we calculate the estimated value of the Shares would be between S$0.53 and S$0.54 for each Share

Based the mean and median P/RNAV ratios of the Property Privatisation Transactions and the RNAV of S$1.247 per Share, the estimated value of the Shares would be between S$0.82 and S$0.88 for each Share.

Overlapping both approaches, the estimated value of the Shares range between S$0.53 and S$0.88 for each Share. The Final Offer Price is within the above range of estimated value of the Shares.

2023 IFA report: https://links.sgx.com/FileOpen/Amara_Off...eID=781050