Haw Par Corporation

[specuvestor]

The Structure of whether the holdco (shop collecting rental) pays out their profit will be a major determinant between OPMI choosing the holdco or the durian stall If both don't then maybe the massage that gives out sufficient profit might be more attractive

[Big Toe]

I love everything durian, if all else being equal, will go for the durian stall for sure. Only durians I have not tried are the hybrid variety. Tried all commercial cultivar and most of the wild cultivars found in Borneo. (And even the kampung durians in Ubin)

But in the case of Haw Par shop, personally it would make more sense for me to invest in the shop, there is more value in the shop. Bearing in mind that this could mean an infinite timeline of holding this until something good happens. Could be years, decades or nothing happens for very long time and cash keeps swelling. Some people call it value trap but I dont agree.

[dreamybear]

Since there is some discussion on SBB / paying out dividends in the OCBC thread ( https://www.valuebuddies.com/thread-2206...#pid172366), I thought the comment(as highlighted below) might be of interest.

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https://hawpar.listedcompany.com/newsroo...5X9X.1.pdf (emphasis added)
"Mr Yeo enquired on the absence of share buyback mandate. He was of the view that share buybacks provide a higher return to the Company as compared to investment in treasury bills to which the CEO replied that the Company had carried out share buybacks in the past but found it to be ineffective as the Company’s shares did not have sufficient liquidity in the market. Furthermore, share buybacks will shrink the balance sheet of the Company, making it worse off in the long term"

[weijian]

Since there is some discussion on SBB / paying out dividends in the OCBC thread ( https://www.valuebuddies.com/thread-2206...#pid172366), I thought the comment(as highlighted below) might be of interest.

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

https://hawpar.listedcompany.com/newsroo...5X9X.1.pdf (emphasis added)
"Mr Yeo enquired on the absence of share buyback mandate. He was of the view that share buybacks provide a higher return to the Company as compared to investment in treasury bills to which the CEO replied that the Company had carried out share buybacks in the past but found it to be ineffective as the Company’s shares did not have sufficient liquidity in the market. Furthermore, share buybacks will shrink the balance sheet of the Company, making it worse off in the long term"

hi dreamybear,

This reply had been discussed in the previously in this thread and so you could read back.

If shrinking the balance sheet is not the goal since it makes the company worst in the long term, then it shouldn't be giving dividends as well since it has the same effect. Maybe that is why some companies have remarkedly consistent dividends, OR had declined giving any - all to improve the balance sheet. It is just unfortunate they haven't proposed shrinking their own paycheck to improve the company's balance sheet.

[weijian]

Haw Par recommends Special Dividend of 85 cents

The board of directors is proposing a special dividend of 85 cents per share to mark Haw Par’s 50th Anniversary. This special dividend will be a one-time payout to reward shareholders for many years of support.

Together with the ordinary dividends, the total payout for the financial year ended 31 December 2018 would be $1.15 per share.

More details in :
1. https://links.sgx.com/FileOpen/HPCL_FY20...eID=545318
2. https://links.sgx.com/FileOpen/Media%20R...eID=545319

So, Haw Par hasn't waited till 2029 for its 60th anniversary to give another special dividend. There is probably "so much cash" on its BS and soon, more coming from its "strategic investment" UOB. Has a change in behavior from its "strategic investment" created a ripple effect on Haw Par? Or did the picture with many names behind also make a difference? Been outsiders, we will probably be none the wiser.

Regardless, these changes in capital allocation by companies listed on local bourse should be well celebrated!

[postage paid]

The United companies UOI, UOB, have also been united in increasing their distributions to shareholders this year.

Could it be because 1 controlling stakeholder has now become many and cash is easier to distribute fairly?

Will look to UOB KH and UOL to find out....

No increased distribution for SingLand to squeeze JG summit whose shares hit a multi decade low due to failure of JG Olefins and getting kicked off MSCI Philippines

[weijian]

The United companies UOI, UOB, have also been united in increasing their distributions to shareholders this year.

Could it be because 1 controlling stakeholder has now become many and cash is easier to distribute fairly?

Will look to UOB KH and UOL to find out....

No increased distribution for SingLand to squeeze JG summit whose shares hit a multi decade low due to failure of JG Olefins and getting kicked off MSCI Philippines

Well, it seems like the shop that is housing both the durian and massage stall is getting MORE attractive!

Wee Cho Yaw’s heirs get access to his US$10 billion estate in UOB, UOL stakes

The estate has relinquished control over the lender and the family’s real estate arm UOL Group, Singapore’s largest listed developer, according to filings on Wednesday (Mar 5).

The transfers at UOB for all the shares that used to be reported under his name – worth about US$9 billion – happened over several months, according to filings. At UOL, his estate’s direct and indirect control over 38 per cent of the company, worth about US$1.4 billion, has also ended.

https://www.businesstimes.com.sg/compani...uol-stakes

[postage paid]

The United companies UOI, UOB, have also been united in increasing their distributions to shareholders this year.

Could it be because 1 controlling stakeholder has now become many and cash is easier to distribute fairly?

Will look to UOB KH and UOL to find out....

No increased distribution for SingLand to squeeze JG summit whose shares hit a multi decade low due to failure of JG Olefins and getting kicked off MSCI Philippines

Well, it seems like the shop that is housing both the durian and massage stall is getting MORE attractive!

Wee Cho Yaw’s heirs get access to his US$10 billion estate in UOB, UOL stakes

The estate has relinquished control over the lender and the family’s real estate arm UOL Group, Singapore’s largest listed developer, according to filings on Wednesday (Mar 5).

The transfers at UOB for all the shares that used to be reported under his name – worth about US$9 billion – happened over several months, according to filings. At UOL, his estate’s direct and indirect control over 38 per cent of the company, worth about US$1.4 billion, has also ended.

https://www.businesstimes.com.sg/compani...uol-stakes

It is only natural that the interests of the heirs (and personal assistants if any) diverge over time. 

For their own sake, I think it makes sense to have a few REIT like companies which holds their assets and pays regular dividends over time to cater to the needs of those who arent business inclined, and a few operating companies where the more enterprising and hard working family members can put their energy into.