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Singapore stock market and companies daily report (United Fiber System ,Yangzijiang Shipbuilding,Sri Trang Agro-Industry ) (September 02, 2010)

Contributed by Shares Investment

By Shares Investment

UniFiber Issues New Shares To Raise $178m

United Fiber System (UniFiber) has proposed to raise $178m through the issue of subscription shares to Falcon Capital Global Holding (Falcon) at an issue price of $0.05 apiece. This will lead to Falcon taking a majority stake of 51.5% of the enlarged share capital of UniFiber. According to UniFiber, US$65m of the proceeds will be used to fund the proposed acquisition of PT Kutai Chip Mill. Another US$20m will be used for the expansion of UniFiber’s wood chip business while the rest will be used as working capital. The company recently reported a net loss of US$2m for 2Q10, as compared with a net profit of US$5.6m in 2Q09. 2Q10 revenue fell 15.3% YoY to US$32.7m.

Significance: The proposed shares issued will help UniFiber strengthen its financial position, given that it is fighting off a move by China National Machinery & Equipment Import & Export Corp to wind it up over debt claims and that its loans and borrowings totaled $21.15m which are due within the next 12 months as at 31 Dec-09.

Yangzijiang To Raise $153m With Issue Of TDRs

Yangzijiang Shipbuilding (Hldgs) is issuing 240m underwritten Taiwan Depository Receipts (TDRs) at NT$18.8 apiece. This translates to about $1.585 for every share since every 2 TDRs represent 1 share of the firm. The offer price represents 0.32% discount to the weighted average price for trades done on SGX on the full market day before the signing of the underwriting agreement yesterday. This exercise is expected to raise about $153m, which will used for general working capital. Under the programme, 197.1m TDRs shall be offered through the bookbuilding process and 21.9m TDRs through public subscription. As required under Taiwanese regulations, an estimated 21m TDRs will be retained by the joint underwriters and about 1,000 TDRs will be placed with the Securities and Futures Investors Protection Centre.

Significance: Yangzijiang’s TDR, being priced at a historical P/E of 6.4, compared with the approximately 14.94 of its peer, CSBC Corporation, on the Taiwan Stock Exchange, leaves an attractive upside for TDR investors upon trading.

Thai Firm Sri Trang Delays Dual Listing In Singapore On Market Volatility

Thailand-listed Sri Trang Agro-Industry Public Company (Sri Trang) is delaying its dual primary listing in Singapore due to recent volatility in the equity markets globally. The firm is conditionally eligible to list on the mainboard of Singapore Exchange (SGX) based on the eligibility-to-list letter from SGX. According to its draft prospectus, Sri Trang is ‘one of the largest processors of natural rubber globally’ with sales volume last year representing 8.4% of global demand. The volume it produced and sold in Thailand accounted for about 15.4% of Thailand’s production volume. Its FY09 net profit for 2009 was BT2.26b compared with FY08’s BT456.84m, thanks to higher margins, forex gains and share of profits from associates and a JV.Revenue was 23% lower at BT46b due to lower selling prices.

This article is contributed by Shares Investment. Visit Sharesinv.com for the latest Singapore, Malaysia and China stock market news and reports.