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Singapore stock market and companies daily report (Mapletree Logistics Trust, Offshore marine, ST Engineering) (March 22, 2013)

Contributed by Shares Investment

Mapletree Logistics Plans $15.5m Property Divestment
Mapletree Logistics Trust, the first Asia-focused logistics REIT in Singapore, entered into an option to purchase agreement with Advanced CAE for the divestment of 30 Woodlands Loop in Singapore at a sale price of $15.5 million. Mapletree Logistics purchased the property in 2007 for $10.3 million. The property was valued at $11 million in March 2012. The trust said that a net disposal gain of approximately $4.95 million is expected from the divestment which will be distributed to unitholders. The purchaser, a unit of Mainboard-listed Advanced Holdings, has exercised the option to purchase the property for the company’s own use. The property is intended to house all operations of the company currently located at 29 Senoko South Road. This will allow Advanced Holdings to secure a permanent place for its Senoko South business instead of using rented premises and having to re-locate at the expiration of the lease term.
Significance: Capital released from the divestment will provide Mapletree Logistics with greater financial flexibility to pursue other attractive investment opportunities offering better yield. In the interim, it will be used for Mapletree Logistics’ working capital.

Otto Marine Clinches New Deals Worth $6.3m
Offshore marine specialist Otto Marine said that its Indonesia-based shipyard, PT Batamec, has secured contracts to fabricate, assemble and deliver four pre-erected columns and pontoon blocks worth a total of $6.3 million. Both projects, secured from a renowned Singapore-based customer, are scheduled for delivery in June 2013. The contracts are expected to have a positive contribution for the financial year ending 31 December 2013. These contracts are a significant milestone in Otto Marine’s bid to expand and to strengthen its shipyard operations and presence in the robust offshore oil and gas industry in the region, the company said in the filing with the Singapore Exchange. Executive director & group chief financial officer, Michael See, went on to say that Otto Marine has made further progress in building its order book since the beginning of this year.
Significance: The news was well-received as shares of Otto Marine opened today’s session 2.4 percent higher at $0.086. Not only are the fabrication contracts testaments to Otto Marine shipyard’s diverse range of capabilities, they bring an immediate boost to shipyard utilisation and contribute to contract win momentum.

ST Engineering Lands US$100m Contract
Integrated engineering group Singapore Technologies Engineering, through its US shipyard, has bagged an exercised option for a barge unit from Bouchard Transportation Company “in the region of US$100 million”. The announcement followed its contract award for a similar one last month. The construction of the first barge will begin in April 2013 with delivery scheduled in mid-2015 while that of the second barge will begin in 4Q13 with delivery scheduled in 1Q16. The barges, which will be used to transport liquid petroleum, will be American Bureau of Shipping and United States Coast Guard certified for Jones Act service. ST Engineering’s order book stood at $12.1 billion as at end-December 2012.
Significance: Driven by contract wins, ST Engineering’s share price has jumped more than 8 percent year-to-date. The biggest project was probably the award, which analysts estimated it at between $1.5 billion and $2 billion, by the Ministry of Defence to design and build eight new patrol vessels for the Singapore Navy.