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Reports Singapore

Singapore stock market and companies daily report (Auric Pacific, Keong Hong, Logistics Holdings) (June 25, 2013)

June 25, 2013, Tuesday, 04:46 GMT | 23:46 EST | 08:16 IST | 10:46 SGT
Contributed by Shares Investment

Auric Moves To Acquire Food Junction
Auric Pacific Group has launched a voluntary unconditional cash offer for Food Junction Holdings (FJ) at $0.255 per share. Based on the offer price and a total of approximately 122 million shares (excluding treasury shares) in issue as at 24 June 2013, the acquisition values FJ at $31.1 million. Presently, Auric holds a majority stake of 61.4 percent and intends to privatise FJ if it obtains a shareholding of 90 percent or more. Chief executive officer of Auric, Saw Phaik Hwa, said: “By raising our equity interest in FJ through this offer, Auric will have greater control and flexibility to align FJ’s business direction with the group’s three-pronged growth strategy – to strengthen our marketing and branding capabilities, improve operational efficiencies and expand geographical reach.” Saw added that FJ has experienced low trading liquidity over the past 12 months and believes that the offer will provide minority shareholders an opportunity to exit and realise their investments for cash at a premium over the market prices during the past year.
Significance: At a cash offer of $0.255 per share, it represents a 40.1 percent premium over its closing price of $0.182 on 20 June 2013, before it requested for a trading halt.

Keong Hong To Build J Gateway For $161.9m
Keong Hong Holdings’ (KHH) subsidiary, Keong Hong Construction, has secured a contract, worth $161.9 million, from MCL Land (Gateway), a subsidiary of MCL Land. KHH was appointed as the main contractor for the private residential development, J Gateway, at Boon Lay Way, Jurong East. With a land area of approximately 11,588 square metres, J Gateway resides within Singapore’s new Central Business District of the West, Jurong Gateway, which boasts amenities such as a MRT station, bus interchange, shopping malls like Jem and J Cube, as well as Ng Teng Fong General Hospital. J Gateway, a 738-unit condominium, will comprise of two towers of 20 and 38 storeys of one to four-bedroom units and penthouses, complete with full condominium facilities including sky gardens, infinity swimming pool, jacuzzi pool, clubhouse and gymnasium. Chairman and chief executive officer of KHH, Ronald Leo, said: “We are excited by J Gateway’s design features and look forward to offer excellence and value-add in construction capabilities, integrating new construction innovation and technology into this project.”
Significance: As of 24 June-2013, KHH’s gross order books based on secured contracts stood at approximately $690 million, with projects stretching up to 2016.

Logistics Holdings Marks Its First Foray In Property Development
Le Premier Development, a newly set-up subsidiary of Logistics Holdings (LH), has exercised its option to purchase Minton Court for approximately $13.4 million, marking LH’s entry in the property development business. With a land area of about 13,271 square feet, the estimated cost of acquisition works out to be approximately $1,010 per square foot. Located at 21 Paya Lebar Crescent, LH intends to redevelop the freehold site into high-end cluster houses development consisting of six to eight units and believes the property’s good location will be a key attraction for property buyers. The move comes on the back of shareholders’ approval in a recent extraordinary general meeting to include property development and property investment in ASEAN, China and the Australasian countries as its core business. LH was awarded three Housing Development Board contracts, worth $110.4 million, earlier in the year, boosting its order books to $329.1 million as of 3 April 2013.
Significance: LH is a construction group principally engaged in building construction works as well as supply and installation of furniture/interior fitting-out works. The move into the upstream property development might potentially provide better profit margin and could contribute favorably to LH’s future bottomline.