Halcyon Agri

[greengiraffe]

Its Old news .... Lee Rubber raising cash to prepare for OCBC rights issue?

http://www.businesstimes.com.sg/premium/...r-20140714

Halcyon Agri buys 9 factories from Lee Rubber
BYKALPANA RASHIWALA
kalpana@sph.com.sg @KalpanaBT

NATURAL rubber producer Halcyon Agri Corporation has sealed a deal with Lee Rubber group to acquire a Singapore-based company that owns and operates nine crumb rubber factories for $450 million. The factories are in South Sumatra, North Sumatra, Jambi and West Kalimantan. They produce Standard Indonesian Rubber for leading global tyre producers.
Anson Company (Private) Limited - the entity being transacted - produced and sold 303,472 tonnes of natural rubber with revenues of $963.2 million in 2013. Earnings before interest, tax, depreciation and amortisation was $41.7 million, and net income was $29.1 million.
The acquisition will be financed through a combination of internal resources, co-investment from Angsana Capital (wholly owned by Halcyon Agri CEO Robert Meyer) and syndicated loan facilities from Credit Suisse AG, Singapore Branch, and DBS Bank as joint mandated lead arrangers and/or the issuance of debt securities.
Halcyon Agri does not currently intend to undertake an equity fund raising exercise in connection with the acquisition. The transaction is subject to approval by its shareholders at an extraordinary general meeting to be held in early August.

[opmi]

FNN ABP money received by Lee Rubber spent finished?


Sent from my iPhone using Tapatalk

[muns]

Did they mention at what utilization capacity were the 9 factories running at? And if after the acquisition, they would be able to ramp up to at least the same rates that Halcyon's current plants are operating at (Which is around 75%)?
___________________________________________________________
Finding the Value in a Speculative World
http://www.valueinvestasia.com

[SpeedingBullet]

Halcyon Agri's 5-Year Bond Issue 16x Oversubscribed

Issue amount: S$125mio
Maturity Date: 31 July 2019
Coupon: 6.5% for 3 yrs, with 2% step up to 8.5% if it's not called.

So Halcyon has to now pay S$8.125mio annually in interest payments. Their op. profit is only about S$15mio, interest would be eating up 54% (more if you count in their existing debt) of that.

Rubber prices have been on a downward trajectory for quite a while:
Rubber Price

Their new acquisition better start paying off soon!

[Behappyalways]

An old news.....well not so old.....^^


[经济信息联播]橡胶暴跌调查 橡胶三年价跌7成 36万吨货压在青岛港
http://jingji.cntv.cn/2014/05/12/VIDE139...4118.shtml

not vested

http://investideas.net/forum/viewtopic.p...4&start=30

[muns]

The 9 acquired factories were running at a decent utilization rate of 74.3% (303,473 out of 408,000 tons) close to Halcyon's own utilization rate!
http://infopub.sgx.com/FileOpen/Project_...eID=305162
___________________________________________________________
Finding the Value in a Speculative World
http://www.valueinvestasia.com

[yawnyawn]

Halcyon Agri's 5-Year Bond Issue 16x Oversubscribed

Issue amount: S$125mio
Maturity Date: 31 July 2019
Coupon: 6.5% for 3 yrs, with 2% step up to 8.5% if it's not called.

So Halcyon has to now pay S$8.125mio annually in interest payments. Their op. profit is only about S$15mio, interest would be eating up 54% (more if you count in their existing debt) of that.

Rubber prices have been on a downward trajectory for quite a while:
Rubber Price

Their new acquisition better start paying off soon!

The assets that they are buying from Lee Rubber generated an operating profit of S$41.7m in 2013. It is more than enough to pay the interest for this bond issue.

Moreover, Anson has S$93.5m in cash & cash eq as of 31 Dec 2013. Effectively, Halcyon Agri is paying S$357m (S$450m-$93.5m) for these assets. Given that the PAT for Anson is S$29m in 2013, Halcyon is paying roughly 12 times earnings for this acquisition. I think this is a good acquisition for Halcyon.

(not vested)

[weilieh]

Halcyon Agri's 5-Year Bond Issue 16x Oversubscribed

Issue amount: S$125mio
Maturity Date: 31 July 2019
Coupon: 6.5% for 3 yrs, with 2% step up to 8.5% if it's not called.

So Halcyon has to now pay S$8.125mio annually in interest payments. Their op. profit is only about S$15mio, interest would be eating up 54% (more if you count in their existing debt) of that.

Rubber prices have been on a downward trajectory for quite a while:
Rubber Price

Their new acquisition better start paying off soon!

The assets that they are buying from Lee Rubber generated an operating profit of S$41.7m in 2013. It is more than enough to pay the interest for this bond issue.

Moreover, Anson has S$93.5m in cash & cash eq as of 31 Dec 2013. Effectively, Halcyon Agri is paying S$357m (S$450m-$93.5m) for these assets. Given that the PAT for Anson is S$29m in 2013, Halcyon is paying roughly 12 times earnings for this acquisition. I think this is a good acquisition for Halcyon.

(not vested)

The 5NC3 feature is probably a well set-up structure for HACL and short-duration investors to come at a mid-point consensus. 3-year tenor might be too inflexible for HACL's balance sheet while investors might feel more comfortable with a shorter tenor issue going forward given the amount of leverage HACL is potentially going to pile on.

I think we also have to consider the preference share coupons (@5%) and the bank borrowings, that should increase the interest payment as well. Anyone knows whether they disclosed the bank borrowings interest rate?

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Finding Value in a Speculative World!
http://www.valueinvestasia.com/

[greengiraffe]

http://www.businesstimes.com.sg/premium/...5-20140819

PUBLISHED AUGUST 19, 2014
Global rubber glut seen tumbling in '15
Demand expected to expand while production drops amid falling prices

Shrinking surplus: 'Small growers across producing regions have started responding to a consistent decline in prices,' says Lekshmi Nair, senior economist at the International Rubber Study Group. - PHOTO: REUTERS
[BANGKOK] The global surplus of natural rubber will shrink 46 per cent next year as demand expands and farmers reduce tapping because of decreasing prices, according to the International Rubber Study Group.
Production next year will outpace demand by 202,000 tonnes against 371,000 tonnes this year and 650,000 tonnes last year, the Singapore- based body said in an e-mail on Aug 13. The group said in May that the glut this year would exceed the 714,000 tonnes in 2013 after it increased output estimates for Thailand, the biggest shipper.
Futures plunged 28 per cent this year, declining to the lowest level in almost five years in June. Supply increased after record prices three years ago spurred output, while demand slowed as the pace of economic expansion decelerated in China, the biggest buyer.
The glut is now contracting as profits decrease for small farmers who represent 80 per cent of world supply amid forecasts for record global car sales.

[greengiraffe]

http://www.businesstimes.com.sg/premium/...e-20140825

PUBLISHED AUGUST 25, 2014
TOPLINE
Halcyon finds bounce in the old rubber trade
Chief sees market returning to normal in 3-6 mths. By JAMIE LEE


Mr Meyer: 'I've never traded a gram of rubber in my life, nor do I want to . . . I like industrial processes. Maybe it's my German heritage.' - FILE PHOTO
THERE'S a new force in the rubber sector. With prized assets from industry stalwart, Lee Rubber, Halcyon Agri Corporation's chairman Robert Meyer wants to take on a clubby business that has yet to be reinvented in the way that other forms of commodity productions have. Halcyon's ambitions, backed mainly by debt-loaded acquisitions, will need traction from Mr Meyer's expectation that the rubber market will return to normalcy in three to six months' time.
Rubber is currently trading at depressed prices not seen in several years.
The rubber market's abnormal state has already hit the bottom line of Halcyon, a company producing rubber for tyre makers.
Yet, for Mr Meyer, the dysfunctional market has been a stroke of good fortune, unearthing acquisition opportunities for a company that was, in its previous self, a private company that invested and restructured companies from various industries.