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The latest PPT from SMRT on the "deal". The total train biz EBIT (fare + non-fare) was 78 million, with EBIT margin 9.5%. The new formula, enable the risk-sharing and also profit sharing among LTA/SMRT in rail operation. SMRT get less, but more secured biz from the "deal".
http://infopub.sgx.com/FileOpen/Slides%2...eID=413002
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Security now last only 15 years
I think this deal is pretty watershed on the govt's thinking of what is a reasonable margin for transport business in an operator model. I'm not sure how the profit collar works in reality ie for example does a one year bonus for staff pushing OM to below 3.5% qualify?
But of course on the structure side transport companies can improve the ROE through capital management but without sizable assets it will be limited.
I think it is a good deal for the public consumer. I think the operator model is a good compromise between capex spending for public / social infrastructure vs Singapore Inc mentality.
Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticize, wait. Before you pray, forgive. Before you quit, try. Before you retire, save. Before you die, give. –William A. Ward
Think Asset-Business-Structure (ABS)
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SMRT Corporation Ltd wishes to announce a continuation of the trading halt pending a possible announcement
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(18-07-2016, 12:09 PM)Vseeker Wrote: SMRT Corporation Ltd wishes to announce a continuation of the trading halt pending a possible announcement
Temasek take over?
brattzz: CPF->SG GOV->LTA->SMRT->IRAS & [NOTHING to temasek] -NOTHING->SG GOV--NOTHING-- >CPF
[New flow?]: Temasek > buyout > SMRT shareholders. Yay! Hahaha...
Dont see the need to privatise leh...the current model: keep high capex assets. outsource to competing private operators. Quite good leh...
"... but quitting while you're ahead is not the same as quitting." - Quote from the movie American Gangster
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18-07-2016, 12:22 PM
(This post was last modified: 18-07-2016, 12:28 PM by Vseeker.)
maybe Temasek (54.1% stake holder in SMRT) saying "I'm abstaining !!, all ye OPMIs go take on LTA+Min Transp... if not happy with the deal...
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At price-to-book of 2.5? Seems hardly worth it.
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Temasek only need to beat 2.5% OA rate?! Hahaha.
"... but quitting while you're ahead is not the same as quitting." - Quote from the movie American Gangster