SingPost – BT
SingPost to acquire Novation for US$9.8m
SINGAPORE Post Ltd yesterday announced that it is acquiring Hong Kong-based Novation Solutions Ltd for US$9.8 million (approximately S$12.7 million), through its wholly owned subsidiary, DataPost Pte Ltd.
DataPost’s purchase of Secured Financial Services Ltd’s entire 100 per cent stake in Novation will be satisfied wholly in cash upon completion, and is to be funded from SingPost’s internal resources.
The completion date of the proposed acquisition is expected to take place on or around Feb 29, upon which Novation will become a wholly owned subsidiary of SingPost.
Novation is a full-service security printing, document management, and transaction mail provider in Hong Kong. Its core services include security and commercial printing and services like variable-data print and electronic direct marketing services. Novation is also present in China.
Wolfgang Baier, SingPost’s group chief executive officer, said that the acquisition is in line with the company’s strategy to grow its digital and hybrid mail business locally and in the region.
‘In transforming SingPost, we have identified digital services as one of our five key business pillars. With this acquisition, we will leverage our combined expertise for expansion into document management and digital printing,’ said Dr Baier, adding that Novation will help to expand SingPost’s footprint in Hong Kong.
As at Dec 31, 2010, the net tangible asset value of Novation was HK$94.3 million (about S$15.7 million). SingPost said that Novation is profitable, and that the proposed acquisition will be on a debt-free basis since Novation has not incurred any debt according to its recent consolidated accounts. The acquisition will not have a material impact on SingPost’s earnings.
SingPost has been expanding its digital and hybrid mail business in the region over the years. Just last year, it acquired a 20.82 per cent stake in Efficient, a Malaysian company which has its core business in business process outsourcing.
SingPost’s shares fell 1.5 cents yesterday to close trading at 95.5 cents per share.
SingPost – BT
SingPost to acquire Novation for US$9.8m
SINGAPORE Post Ltd yesterday announced that it is acquiring Hong Kong-based Novation Solutions Ltd for US$9.8 million (approximately S$12.7 million), through its wholly owned subsidiary, DataPost Pte Ltd.
DataPost’s purchase of Secured Financial Services Ltd’s entire 100 per cent stake in Novation will be satisfied wholly in cash upon completion, and is to be funded from SingPost’s internal resources.
The completion date of the proposed acquisition is expected to take place on or around Feb 29, upon which Novation will become a wholly owned subsidiary of SingPost.
Novation is a full-service security printing, document management, and transaction mail provider in Hong Kong. Its core services include security and commercial printing and services like variable-data print and electronic direct marketing services. Novation is also present in China.
Wolfgang Baier, SingPost’s group chief executive officer, said that the acquisition is in line with the company’s strategy to grow its digital and hybrid mail business locally and in the region.
‘In transforming SingPost, we have identified digital services as one of our five key business pillars. With this acquisition, we will leverage our combined expertise for expansion into document management and digital printing,’ said Dr Baier, adding that Novation will help to expand SingPost’s footprint in Hong Kong.
As at Dec 31, 2010, the net tangible asset value of Novation was HK$94.3 million (about S$15.7 million). SingPost said that Novation is profitable, and that the proposed acquisition will be on a debt-free basis since Novation has not incurred any debt according to its recent consolidated accounts. The acquisition will not have a material impact on SingPost’s earnings.
SingPost has been expanding its digital and hybrid mail business in the region over the years. Just last year, it acquired a 20.82 per cent stake in Efficient, a Malaysian company which has its core business in business process outsourcing.
SingPost’s shares fell 1.5 cents yesterday to close trading at 95.5 cents per share.
SPH – DBSV
Commercial land at Sengkang West/Fernvale Rd receives good response
A commercial site put up for tender by HDB at Sengkang West Avenue/Fernvale Rd met with good response, attracting 12 bidders. The top price of 328m or $1,155psf ppr was submitted by a consortium made up of SPH and UE. It beat the second bidder Alpro management (JHan Chee Juan, developer of Iluma) with a $959psf ppr price tag. The 94,619sf site can house 283,856sf of GFA. Located at the Fernvale LRT station, the site is seamlessly linked to the Sengkang MRT/LRT station and Sengkang bus interchange and will cater to the lifestyle needs of the growing Sengkang residents as well as those in the north eastern regions of Hougang, Punggol and Serangoon Central.
Based on our estimates, we reckon breakeven cost of the development is $2,300-2,350psf. Based on stabilized monthly rental estimates of $12-14psf, the development can yield 4.3-5.1% return when completed and fully tenanted.
The response continues to support our view of the more resilient nature of suburban retail malls as they cater to more non-discretionary spending patterns. We reiterate our positive stance and maintain Buy call on landlord CMT.
SPH/UED’s top bid for Sengkang retail site – a long term perspective in retail malls
Additional comments on SPH’s bid for retail site at Sengkang West/ Fernvale
• SPH’s continued move in retail mall investment not surprising
• Bid seems optimistic, but likely to adopt a long term perspective given area’s potential
• Do not expect any impact on its DPS (24 Scts)
• Maintain Hold recommendation & TP
SPH – DBSV
Commercial land at Sengkang West/Fernvale Rd receives good response
A commercial site put up for tender by HDB at Sengkang West Avenue/Fernvale Rd met with good response, attracting 12 bidders. The top price of 328m or $1,155psf ppr was submitted by a consortium made up of SPH and UE. It beat the second bidder Alpro management (JHan Chee Juan, developer of Iluma) with a $959psf ppr price tag. The 94,619sf site can house 283,856sf of GFA. Located at the Fernvale LRT station, the site is seamlessly linked to the Sengkang MRT/LRT station and Sengkang bus interchange and will cater to the lifestyle needs of the growing Sengkang residents as well as those in the north eastern regions of Hougang, Punggol and Serangoon Central.
Based on our estimates, we reckon breakeven cost of the development is $2,300-2,350psf. Based on stabilized monthly rental estimates of $12-14psf, the development can yield 4.3-5.1% return when completed and fully tenanted.
The response continues to support our view of the more resilient nature of suburban retail malls as they cater to more non-discretionary spending patterns. We reiterate our positive stance and maintain Buy call on landlord CMT.
SPH/UED’s top bid for Sengkang retail site – a long term perspective in retail malls
Additional comments on SPH’s bid for retail site at Sengkang West/ Fernvale
• SPH’s continued move in retail mall investment not surprising
• Bid seems optimistic, but likely to adopt a long term perspective given area’s potential
• Do not expect any impact on its DPS (24 Scts)
• Maintain Hold recommendation & TP
SMRT – DBSV
Disembark and move on
• A lower DPS could be additional de-rating catalyst for the counter in light of challenges faced
• Lowered our FY13F yield projections to 4.1%
• Negative profit growth, regulatory risks, management changes are reasons not to hold on
• Cut earnings by 11%/12%; Downgrade to Fully Valued, TP lowered to S$1.50
Lowering our DPS in FY13F. We believe prospective dividend payout could have downside risk on the back of lower profits, higher repair and maintenance costs, and possibly regulatory policy changes. We have lowered our FY13F DPS to 7.25 Scts (interim and final payout) equating to a payout ratio of c.79%, similar to FY07 to FY10. This would bring the prospective dividend yield down to c.4.1%; and, could be an additional de-rating catalyst for the stock, in our view.
Many reasons not to hold on. We project earnings to register -15%/ 1% growth in FY12F/ 13F after trimming forecasts by 11%/12% on higher expenses and lower ridership growth. Higher regulatory risks going forward, as well as the numerous management departures over the last 14 months add to reasons for not holding this counter.
Downgrade to Fully Valued, cut earnings and TP. We lowered our PE/DCF-based TP to S$1.50 given lower earnings, and a lower target PE valuation peg of 13x (-0.5 std dev from average) given sub-par earnings growth. We are cautious on the counter and downgrade SMRT to Fully Valued.