Category Archive: Shares

Apr
26
2012

Sale of Unit by Suntec REIT’s Manager

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by Martin Lee

April 26, 2012

There was an article in the Straits Times which mentioned that minority shareholders were upset with the bulk sale of Suntec REIT’s units by their manager.

Minority shareholders are upset that this unloading is depressing the share price of Suntec REIT.

How it came about is because the manager is paid 80% of its management fees by the issuance of Suntec REIT units.

Mr Yeo See Kiat, chief executive officer of ARA Trust Management (Suntec), the manager of Suntec REIT, said the units were sold to fund the operations of the REIT manager, such as rent and salaries.

Last year, the manager was paid S$36.1 million, out of which S$28.3 million came in the form of 22.1 million new units in Suntec REIT. This works out to be an average price of S$1.28 per Suntec REIT unit.

I had a chuckle when I read this statement by Mr Yeo, “‘The manager is happy to receive our fees in cash but by receiving 80% of our fees in units, our interests are aligned with our unitholders.”

I would think alignment of the interests only works if the manager had kept all or most of their units. As it is, ARA Trust Management (Suntec) sold almost all of the units that they had received as part of the management fee.

It only held 893 units at the middle of last month, having sold more than 20 million units in the open market. So much for alignment of interests.

However, the parent company, ARA Asset Management, does hold 34 million units in Suntec REIT. This is a long term stake which they mentioned they will not sell.

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Feb
29
2012

Launch of Lyxor Indonesia and Thailand ETF

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by Martin Lee

February 29, 2012

Lxyor has recently launched two new ETFs, one for Indonesia and the other for Thailand.

Both are swap-based and have a trading currency of USD. The ETFs have an annual management fee of 0.55% and 0.45% respectively.

This brings the total number of ETFs on SGX to 92.

The new ETFs offer exposure to Thailand and Indonesia and track the Stock Exchange of Thailand (SET) Total Return Index (SET50 TRI) and the MSCI Indonesia Index respectively.

Thailand and Indonesia ETFs were among the top 10 most actively traded ETFs on SGX in 2011. The top three traded ETFs were SPDR Gold Shares, iShares MSCI India ETF and DB X-trackers MSCI Asia Ex-Japan ETF.

The SGX ETF market has grown strongly in 2011 with an increased turnover of 36% compared to the previous year.

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Feb
06
2012

Second Chance Whistle Blower Reward

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by Martin Lee

February 6, 2012

Saw this announcement by Second Chance Properties which was posted in conjunction with the release of their unaudited results.

Reward of $50,000 cash to Whistleblowers

To further strengthen its Whistle Blower Policy, the Company has implemented a strong deterrent by offering a cash reward to any person whether employees, suppliers, business associates or the general public who provides specific, reliable and credible information or evidence of fraudulent activities by any of the Company’s Executive Director and Management Team as listed in the Company’s Annual Report ($50,000/- cash reward) and all other employees (up to $2,000/- cash reward) which leads to admission of guilt by the accused or leads to successful prosecution.

Please visit our website www.secondchance.com.sg for full details.

This is the first time that I have seen a company highlight their Whistle Blower Policy so prominently together with its results announcement. So if you are in need of some spare cash and know something (provided there is) that fits the criteria listed in the Second Chance Properties Whistle Blower Reward Scheme, you know what to do. :D

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Feb
02
2012

Research Reports on Singapore Listed Companies

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by Martin Lee

February 2, 2012

The different brokerage firms will produce their own in-house research reports on selected SGX-listed companies.

You can access the various research reports if you have a trading account with the respective brokerage firms.

Another way is to visit The Society of Remisiers website, which holds the research reports of all the brokerage firms.

However, it seems that they only store the reports for the last thirty days. Well, at least it is still quite useful to be able to find all the reports at one central location.

The website lists the research reports by the dates on which they are released, so it will be easier to find what you want using the search function.

In terms of usefulness, I will usually look at the data but ignore the target price and recommendation set by the analyst. :D

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Jan
27
2012

Suspension of Pertama

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by Martin Lee

January 27, 2012

Pertama is no more. :(

Ok, I’m exaggerating it a little.

Back in June 2011, Pertama had proposed a delisting of the shares (at $0.65 a share) as it saw no need to maintain a listing status. The cash flow of the business was good, and it had no plans for any capital raising.

The free float of the shares was also very small with Harvey Norman Singapore Pte. Ltd. (“HNS”) and HNS’s subsidiary, Harvey Norman Ossia (Asia) Pte Ltd (“HNO”) collectively holding approximately 83% of the total number of issued shares. FMR LLC and Edward C. Johnson 3rd hold approximately 9%  of the total number of issued shares.

The proposal was shot down by minority shareholders at the EGM, and the shares continued to trade at a price lower than $0.65 with low transaction volumes.

The free float of the shares was in fact less than 10%, which meant that the shares had to be suspended from trading unless the company could increase the percentage of free float in the market.

As the majority shareholder had no intention to sell his shares and the company had no mandate to do a share placement to issue more shares, the shares of Pertama would have to be suspended from trading (starting from today).

A lot of retail investors would worry about such a suspension as they would not be able to get out of their positions.

Not me.

After my previous sucking thumb exercise and failure to add to my original purchase back in 2001, I did not hesitate this time. I managed to accumulate more Pertama shares since the general offer failed (By the way, this is one advantage of being a retail investor because an institutional investor will not be able to find enough shares to buy to make the exercise worthwhile).

As the majority shareholder Harvey Norman had made a previous exit offer, they are not allowed to make another one within a 12-month time frame. They had tried asking for a waiver from Securities Industry Council (SIC) to waive this requirement for them to make a voluntary general offer for all shares that they do not own but was rejected by SIC.

What is likely to happen is that Harvey Norman will make another general offer after the 12-month moratorium was up. And then Pertama will finally be delisted.

Such a buy and hold strategy (without being able to sell) might bore a lot of investors to tears, but having seated on this position for ten years, I’m happy to wait for another year. :)

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