Fraser & Neave (F & N)

[jaco]

@weijian

All fair comments regarding the issue. However, we are left with the original question: why the recent share buy-backs of F&N itself ? They haven't done those since 2015. Is it really a coincidence that the buy-backs are resumed at the same time as the share-swap within the same business group?

Again, I am not holding my breath while waiting for a privatization. I just observe the developments with interest. I might ask about the share buy-backs at the upcoming AGM, although some generic, cookie-cutter answer might be expected.

[weijian]

Hi jaco,

Maybe the "independent" BOD finally awoken to the IFA's fair valuation of 3.55sgd, and decide to do some real value investing for shareholders now. There is great uncertainty in terms of the motivation for SBB, but great certainty in terms of the end result of SBB for shareholders' value creation.

P.S. Looking forward to reading and learning from the great pre/post AGM Q&As from VBs

[jaco]

One more post on the issue. I only found this report just now after a reference in The Edge this weekend and thought it should be part of the discussion ...

https://www.dbs.com.sg/treasures/aics/te...122024.xml

DBS Research points out that ThaiBev already privatized Oishi Pcl and Serm Suk Pcl (both in Thailand) recently. DBS believes that ThaiBev might be consolidating its F&B interests in order to spin those off later. Such a spin-off would be a step further than just 'cleaning up' the group structure, but also suggests a F&N privatization.

[weijian]

Hi jaco,

It is the job of the investment banking unit of every bank to be pitching possibilities to their clients. It is definitely beneficial to the bankers to have these series of privatization/spin-offs - privatize all food related businesses, consolidate and then spin them off 1 by 1 into FoodCo, BeerCo, SpiritsCo etc.....End of the day, ThaiBev becomes a holding company and the bankers will suggest a name change to ThaiBev Holdings or worst off ThaiBev Strategic (Yoma Strategic anyone?). A VB keyboard warrior like me can do it just as good as those folks in suits.

But the key question is - is it beneficial to Chaoren Juniors who are taking over? A lot of Asian family-owned companies are in the business of sustaining wealth for themselves, as the prior generation had already created the wealth. Sustaining wealth and creating wealth may have overlapping actions but both are much more different than similar.

So first and foremost, rather than listening to possibilities from the mouths of people who are hoping to earn fees from it, we have to decide on Chaoren Juniors' intention first before we open our ears to their "flowery language".