Latest news with #Widjaja-family
Business Times
06-05-2025
- Business
- Business Times
IFA stands its ground on valuations in Sinarmas Land offer; says methods used ‘appropriate' and in line with practice
[SINGAPORE] W Capital Markets, which is advising Sinarmas Land's independent directors on the Widjajas' offer to privatise the company, insists its valuations of the group's assets are 'appropriate' and 'consistent with widely accepted industry practice'. The independent financial adviser (IFA) was responding to concerns raised by the Singapore Investors Association (Singapore) or Sias, and The Business Times columnist Ben Paul in his Mark to Market column. Both parties had argued that the IFA's valuation range for Sinarmas Land shares was undervalued. In a letter addressed to Sinarmas' independent directors on Monday, W Capital said it 'categorically refutes' these suggestions and that it had adopted the most appropriate methods in line with conventional industry practice by other IFAs in Singapore. It had earlier said the offer from Widjaja-family linked Lyon Investments was 'not fair but reasonable', estimating a fair value range of S$0.35 to S$0.361 per share, derived from a sum-of-the-parts (SOTP) analysis of the company's listed and unlisted assets. BT columnist Ben Paul had questioned the IFA's fair value and whether its valuations captured the full potential of Sinarmas Land's components, noting that the company's assets could likely fetch prices in the private market that are 'well above the valuations implied by their public-listed holding companies'. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up In response, W Capital Markets said the SOTP method was appropriate given Sinarmas Land's nature as a pure investment holding company, with no direct control over the assets held by the company's listed subsidiaries that operate under separate management teams. On the view that IFAs tend to ignore how the basis of valuation might change once a target company is taken private, W Capitals said its role was not to speculate on and assess private market valuation frameworks that may alter a company's value after a delisting. 'Our adopted yardsticks for assessment do not deviate from conventional industry practice taken by other IFAs in Singapore,' the firm said. Sias had charged that the IFA's valuation had 'double-discounted' Sinarmas Land's unlisted assets, both in its SOTP analysis which valued the assets at a 37 per cent discount to its revalued net asset value (RNAV), as well as applying a 'holding company discount' of 20 to 22 per cent to its valuation. The IFA responded that the company's RNAV may not reflect fair value, as it does not account for additional costs including professional fees, liquidation costs or regulatory requirements, which could all reduce the realisable RNAV. It noted that comparable companies and past Singapore Exchange privatisations have typically been priced below net asset value and in such cases, were deemed to be fair and reasonable by IFAs. As for the holding company discount, it said such methods are commonly applied to reflect the market perception of risks involved in owning a holding company. Corporate expenses, tax implications from dividends and investors' limited control over subsidiaries could also be the basis for such discounts, the IFA said. 'We strongly disagree with Sias' view that there is double discounting,' said Wayne Lee, chairman and chief executive officer of W Capital Markets, arguing that the holding company discount is conceptually distinct from the SOTP methodology. Shares of Sinarmas Land were trading flat at S$0.32 at 3 pm on Tuesday.
Business Times
06-05-2025
- Business
- Business Times
IFA defends valuation methods in Sinarmas Land offer as ‘appropriate' amid criticism
[SINGAPORE] W Capital Markets, the independent financial adviser (IFA) appointed by Sinarmas Land to opine on its privatisation offer by the Widjaja-family linked Lyon Investments, responded to criticisms by The Business Times and the Singapore Investors Association (Singapore) or Sias, arguing that its advice was 'appropriate' and 'consistent with widely accepted industry practice'. Both parties had made claims on Monday (May 5) that the IFA's valuation range for shares of Sinarmas Land was undervalued. W Capital Markets said in a letter addressed to the independent directors of Sinarmas Land on Monday that it 'categorically refutes' these suggestions and that it had adopted the most appropriate methodologies in line with conventional industry practice by other IFAs in Singapore. It had earlier said that the offer was 'not fair but reasonable', estimating a fair value range of S$0.35 to S$0.361 per share. The Business Times' Mark to Market column had questioned the IFA's fair value, which W Capital Markets had derived from a sum-of-the-parts (SOTP) analysis of the company's listed and unlisted assets. The columnist also questioned whether the IFA's valuations captured the full potential of Sinarmas Land's components, noting that the company's assets could likely fetch prices in the private market that are 'well above the valuations implied by their public-listed holding companies'. In response, W Capital Markets said that its use of an SOTP valuation was appropriate given Sinarmas Land's nature as a pure investment holding company, with no direct control over the assets held by the company's listed subsidiaries that operate under separate management teams. The IFA also said that its role is not to speculate on and assess private market valuation frameworks that may alter a company's value after a delisting, which the firm described as 'fundamentally different'. 'Our adopted yardsticks for assessment do not deviate from conventional industry practice taken by other IFAs in Singapore,' the firm said. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Sias had argued in its statement that the IFA's valuation had 'double-discounted' Sinarmas Land's unlisted assets, both in its SOTP analysis which valued the assets at a 37 per cent discount to its revalued net asset value (RNAV), as well as applying a 'holding company discount' of 20 to 22 per cent to its valuation. The IFA responded that the company's RNAV may not reflect fair value, as it does not account for additional costs including professional fees, liquidation costs or regulatory requirements, which could all reduce the realisable RNAV. It noted that comparable companies and past Singapore Exchange privatisations have typically been priced below net asset value and in such cases, were deemed to be fair and reasonable by IFAs. W Capital Markets also defended its application of the holding company discount, stating that such methods are commonly practiced to reflect the market perception of risks involved in owning a holding company. Corporate expenses, tax implications from dividends and investors' limited control over subsidiaries could also be the basis for such discounts, the IFA said. 'We strongly disagree with Sias' view that there is double discounting,' said Wayne Lee, chairman and chief executive officer of W Capital Markets, arguing that the holding company discount is conceptually distinct from the SOTP methodology. Shares of Sinarmas Land were trading flat at S$0.32 at 9.29 am on Tuesday.
Business Times
06-05-2025
- Business
- Business Times
IFA in Sinarmas Land offer defends valuation methods as ‘appropriate' amid criticism
[SINGAPORE] W Capital Markets, the independent financial adviser (IFA) appointed by Sinarmas Land to opine on its privatisation offer by the Widjaja-family linked Lyon Investments, responded to criticisms by The Business Times and the Singapore Investors Association (Singapore) or Sias, arguing that its advice was 'appropriate' and 'consistent with widely accepted industry practice'. Both parties had made claims on Monday (May 5) that the IFA's valuation range for shares of Sinarmas Land was undervalued. W Capital Markets said in a letter addressed to the independent directors of Sinarmas Land on Monday that it 'categorically refutes' these suggestions and that it had adopted the most appropriate methodologies in line with conventional industry practice by other IFAs in Singapore. It had earlier said that the offer was 'not fair but reasonable', estimating a fair value range of S$0.35 to S$0.361 per share. The Business Times' Mark to Market column had questioned the IFA's fair value, which W Capital Markets had derived from a sum-of-the-parts (SOTP) analysis of the company's listed and unlisted assets. The columnist also questioned whether the IFA's valuations captured the full potential of Sinarmas Land's components, noting that the company's assets could likely fetch prices in the private market that are 'well above the valuations implied by their public-listed holding companies'. In response, W Capital Markets said that its use of an SOTP valuation was appropriate given Sinarmas Land's nature as a pure investment holding company, with no direct control over the assets held by the company's listed subsidiaries that operate under separate management teams. The IFA also said that its role is not to speculate on and assess private market valuation frameworks that may alter a company's value after a delisting, which the firm described as 'fundamentally different'. 'Our adopted yardsticks for assessment do not deviate from conventional industry practice taken by other IFAs in Singapore,' the firm said. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Sias had argued in its statement that the IFA's valuation had 'double-discounted' Sinarmas Land's unlisted assets, both in its SOTP analysis which valued the assets at a 37 per cent discount to its revalued net asset value (RNAV), as well as applying a 'holding company discount' of 20 to 22 per cent to its valuation. The IFA responded that the company's RNAV may not reflect fair value, as it does not account for additional costs including professional fees, liquidation costs or regulatory requirements, which could all reduce the realisable RNAV. It noted that comparable companies and past Singapore Exchange privatisations have typically been priced below net asset value and in such cases, were deemed to be fair and reasonable by IFAs. W Capital Markets also defended its application of the holding company discount, stating that such methods are commonly practiced to reflect the market perception of risks involved in owning a holding company. Corporate expenses, tax implications from dividends and investors' limited control over subsidiaries could also be the basis for such discounts, the IFA said. 'We strongly disagree with Sias' view that there is double discounting,' said Wayne Lee, chairman and chief executive officer of W Capital Markets, arguing that the holding company discount is conceptually distinct from the SOTP methodology. Shares of Sinarmas Land were trading flat at S$0.32 at 9.29 am on Tuesday.
Business Times
06-05-2025
- Business
- Business Times
Stocks to watch: Sinarmas Land, Frasers Hospitality Trust, Procurri Corp
[SINGAPORE] The following companies saw new developments that may affect trading of their securities on Tuesday (May 6). Sinarmas Land : W Capital, the independent financial advisor (IFA) appointed by Sinarmas Land to opine on its privatisation offer by the Widjaja-family linked Lyon Investments, responded to an article by The Business Times and a statement by Sias that were both published on Monday. Both parties had made claims that the IFA's valuation range of S$0.35 to S$0.361 for shares of Sinarmas Land of was undervalued. W Capital said on Tuesday that it had adopted to most appropriate methodologies in line with conventional industry practice by other IFAs in Singapore. Shares of Sinarmas Land closed at S$0.32 on Monday, up S$0.005 or 1.6 per cent. Frasers Hospitality Trust (FHT) : The stapled securities group on Tuesday posted a 6 per cent drop in distribution per stapled security to S$0.010257 for its first half year ended Mar 31, from S$0.01091 in the corresponding year-ago period. This decline was attributed to lower net property income and higher finance costs arising from the refinancing of borrowings in a higher interest rate environment. The distribution will be paid on Jun 27, after the record date on May 15. Stapled securities of FHT closed S$0.01 or 1.5 per cent lower at S$0.65 on Monday. Procurri Corp : The IT solutions provider has appointed Evolve Capital Advisory as the IFA for the acquisition offer from parent company Exeo Global Asset Holdings amid a potential delisting from the Singapore Exchange. The mainboard-listed company said on Monday that the IFA will advise its independent directors, who will make a recommendation to shareholders on the proposed acquisition. Procurri and Exeo Global Asset Holdings announced the proposed acquisition on Apr 28 for the latter to acquire all of Procurri's shares, except those it already holds and any treasury shares, for S$0.32 in cash per share. The offer price represents a 77.8 per cent premium to Procurri's traded price on Apr 25, when the company requested a trading halt after the market closed. Its shares closed flat at S$0.30 on Monday.
