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Rights Issue: 1 for 2 @ S$1.30 per Rights Share
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katak88
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11-Feb-2009 22:10
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Business Times - 11 Feb 2009
CapitaLand rises, CMT falls after rights issues CAPITALAND and its listed retail trust CapitaMall Trust (CMT) announced massive rights issues on Monday. But while CapitaLand's $1.84 billion one-for-two rights issue has been well-received by analysts and the market, CMT's $1.23 billion nine-for-10 rights offer has not fared as well. Analysts rushed to issue 'buy' calls on CapitaLand after the developer said it was raising money to boost its war chest to $6 billion as it searches for acquisitions. CMT, on the other hand, was criticised for an 'unwarranted dilution'. The market seemed to agree yesterday. CapitaLand shares gained 11.4 per cent or 27 cents, to close at $2.63. But CMT lost 6.2 per cent or nine cents to close at a one-year low of $1.36. Merrill Lynch upgraded CapitaLand to 'buy' from 'underperform', while OCBC Investment Research upgraded it to 'buy' from 'hold'. CLSA, Kim Eng, UBS Investment Research and UOB-Kay Hian all reiterated 'buy' calls too. 'We believe the cash raised provides CapitaLand with the financial flexibility to ride through challenging property markets, enhance market positioning and, more significantly, the ability to take advantage of opportunistic acquisitions,' Merrill said. A few firms were less bullish. Citigroup, CIMB and Nomura maintained their respective 'sell', 'underperform' and 'reduce' recommendations. Citigroup said the rights issue will be a drag on CapitaLand's return on equity. Goldman Sachs, which has a 'neutral' call on the company, said the rights issue is sufficient to address investor concerns over book value erosion from land bank provisions and associated asset value declines (from listed trusts), which Goldman estimates could be around $1.9 billion spread over the next two or three years. 'With the sizable rights offering, we see no further need for capital raising in the next two years into the downturn, as the company has said it plans to revisit project commitments,' said Goldman analysts Paul Lian and Natasha Parchani. A successful rights issue would refocus attention on CapitaLand's capacity to benefit from the current market environment as it is more likely than its peers to generate net asset value growth in the next two or three years, the analysts said. Reviews for CMT's $1.23 billion rights issue were more mixed. The trust intends to use the bulk of the proceeds to pay off $956.2 million of debt due this year. CLSA downgraded CMT from 'outperform' to 'underperform'. In contrast, OCBC upgraded the stock from 'hold' to 'buy'. 'While the proceeds will help the company repay debt and lower gearing to 29.1 per cent (from 43 per cent currently), we see the rights issue to be rather value dilutive,' said CLSA analyst Yew Kiang Wong. The cost of retired debt, at 3.4 per cent, is much lower than the cost of equity, CLSA noted. But OCBC analyst Foo Sze Ming said the rights issue is not driven by refinancing issues and is instead for the 'long-term sustainable growth of CMT's portfolio'. 'By paring its gearing level now, CMT will have better financial flexibility to take on opportunities for asset enhancement initiatives and acquisitions in future,' Mr Foo said. |
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des_khor
Supreme |
10-Feb-2009 00:37
Yells: "Tell me who is the God or MFT from this forum??" |
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the company dry liao.... need more cash to make it wet !! |
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katak88
Senior |
10-Feb-2009 00:33
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Indicative Timetable An indicative timeline for the Lodgement of Rights Issue (which is conditional upon the receipt of the inprinciple approval from the SGX-ST to deal in and for the listing of and quotation for the Rights Shares on the Official List of the SGX-ST) is set out below (all references are to Singapore dates and times):Offer Information Statement with MAS : Monday, 16 February 2009Shares trade ex-Rights : Thursday, 19 February 2009 from 9.00 a.m.Books Closure Date Despatch of the Commencement of trading of Last date and time for splitting Last date and time for trading of Last date and time for acceptance of and payment for Last date and time for renunciation of and payment for Last date and time for application and payment for excess Expected date for issuance of Expected date for commencement of trading of The indicative timetable above is subject to modifications at the discretion of : Monday, 23 February 2009 at 5.00 p.m.Offer Information Statement and accompanying documents, to Entitled Shareholders : Thursday, 26 February 2009Rights : Thursday, 26 February 2009 at 9.00 a.m.Rights : Friday, 6 March 2009 at 5.00 p.m.Rights : Friday, 6 March 2009 at 5.00 p.m.Rights Shares : Thursday, 12 March 2009 at 5.00 p.m. (at 9.30 p.m. for electronic applications)Rights Shares : Thursday, 12 March 2009 at 5.00 p.m.Rights Shares : Thursday, 12 March 2009 at 5.00 p.m. (at 9.30 p.m. for electronic applications)Rights Shares : Friday, 20 March 2009Rights Shares : Monday, 23 March 2009CapitaLand, following consultation with the Joint Lead Managers and Joint Underwriters. |
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katak88
Senior |
09-Feb-2009 23:49
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