MARKET UPDATES :
- GLOBAL Logistics Properties Limited (GLP) is teaming up with Singapore investment firm GIC to buy a US$8.1 billion logistics portfolio in the US, which it said would give it “immediate” scale in the world’s largest logistics market. The portfolio, comprising 117 million square feet in total gross floor area, is spread across 36 major sub-markets in the US. Currently owned by various portfolio companies affiliated to private equity firm Blackstone Group, it was 90 per cent leased as at Sept 30, with a weighted average lease expiry of 3.2 years.
- Singapore state investor Temasek Holdings has agreed to buy a stake in New York-based electronic dealing firm Virtu Financial Inc IPO-VIRT.O , said a person familiar with the talks, betting on the growth of automated trading globally. Temasek will purchase just less than 10 per cent of Virtu Financial, said the person.
- SEVERAL real estate investment trusts (Reits) have banded together to form an association – the Reit Association of Singapore (Reitas) – to promote the growth of Singapore’s Reit sector. It will be headed by a nine-member executive committee, comprising representatives from some of the major Reits and sponsors such as Mapletree, CapitaLand, Frasers and Keppel.
- Olam announced the acquisition of McCleskey Mills Inc (MMI), the third largest peanut sheller at an enterprise value of US$176m (S$231m). This represents an EV/EBITDA multiple of c.6x (based on normalised average 3-year historical EBITDA) which is lower than the 7x paid for Universal Blanchers, a leading peanut blancher and ingredient processor in 2007. The acquisition will be funded through a combination of internal accruals and existing debt facilities. The acquisition of MMI is a positive strategic move for the group, as Olam now becomes the most vertically integrated player in the US peanut industry, with assets in shelling, blanching and ingredients in the US.
- Singapore Telecom – Dividends + Growth: An attractive stock-: Mobile market dynamics in Singapore have improved with lower handset subsidies and higher data pricing. SingTel regional associates’ (Bharti Airtel, Telkomsel, AIS, Globe Telecom) currencies such as INR, IDR have stabilized. SingTel offers an attractive proposition – c5% dividend yield with exposure to growth from regional mobile associates . Fixed Enterprise market is highly profitable with SingTel and StarHub competing rationally . Management team incentivized to create shareholder value.
- OUE’s 1Q13 result was below expectations due to 1) higher admin expenses, and 2) lower-than-expected associate income. While the result looks weak, we believe the potential REIT will remain the key share price driver in the near term. ore net profit of S$14.9m formed 15% of our and consensus’s full-year estimates. We cut our FY13 core EPS estimates on higher costs assumptions and lower associate contributions, but retain our target price (still at a 20% discount to RNAV) pending an earnings call by management Maintain outperform.
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