Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<div>
Subsequent to contentious allegations over a land lease agreement (LLA), on the 8 December, government-backed FELDA announced a possible <a href="https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3112207" target="_blank" rel="noopener">mandatory takeover</a> (MTO) of <a href="https://www.smartkarma.com/entities/fgv-holdings-bhd" target="_blank" data-smartkarma-citation="entities:2200:1" rel="noopener">FGV Holdings Bhd (FGV MK)</a> at RM1.30/share, a 2.36% premium to last close. 
FELDA, holding a 36.61% stake in FGV, additionally entered into conditional SPAs to buy the 6.10% and 7.78% stakes held by Kumpulan Wang Persaraan (Retirement Fund - a statutory body which manages the pension scheme for Malaysia's public employees) and Urusharta Jamaah (an investment holding company owned by the Ministry of Finance) for RM658mn.  Those SPAs were completed on the 22 December, <a href="https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3115981" target="_blank" rel="noopener">triggering</a> an unconditional MTO. This Offer was unconditional as FELDA held 50.49% when taking into account Parties Acting in Concert (PACs).
The Offer Document was despatched on the <a href="https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3120407" target="_blank" rel="noopener">12 January</a>, with the First Closing Date on the 2 February.
The Independent Advice Circular (IAC) has now been <a href="https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3123307" target="_blank" rel="noopener">despatched</a>. Not surprisingly, the independent advisor (RHB) considers the Offer is Not Fair, but Reasonable, and therefore recommends shareholders to accept the Offer.
Irrespective, this deal is done, and is currently trading at terms.  
</div>
<div>
More below the fold.
</div>


Subsequent to contentious allegations over a land lease agreement (LLA), on the 8 December, government-backed FELDA announced a possible mandatory takeover (MTO) of FGV Holdings Bhd (FGV MK) at RM1.30/share, a 2.36% premium to last close. 
FELDA, holding a 36.61% stake in FGV, additionally entered into conditional SPAs to buy the 6.10% and 7.78% stakes held by Kumpulan Wang Persaraan (Retirement Fund - a statutory body which manages the pension scheme for Malaysia's public employees) and Urusharta Jamaah (an investment holding company owned by the Ministry of Finance) for RM658mn.  Those SPAs were completed on the 22 December, triggering an unconditional MTO. This Offer was unconditional as FELDA held 50.49% when taking into account Parties Acting in Concert (PACs).
The Offer Document was despatched on the 12 January, with the First Closing Date on the 2 February.
The Independent Advice Circular (IAC) has now been despatched. Not surprisingly, the independent advisor (RHB) considers the Offer is Not Fair, but Reasonable, and therefore recommends shareholders to accept the Offer.
Irrespective, this deal is done, and is currently trading at terms.  


More below the fold.


On the 1 November 2011, <a href="https://www.smartkarma.com/entities/fgv-holdings-bhd" target="_blank" data-smartkarma-citation="entities:2200:1" rel="noopener">FGV Holdings Bhd (FGV MK)</a> signed a Land Lease (LLA) Agreement with Federal Land Development Authority (FELDA), whereby 351,000 ha of FELDA’s land was leased to FGV for 99 years.
On the <a href="https://www.fgvholdings.com/press_release/official-statement-of-fgv-holdings-berhad-on-felda-land-lease-agreement/?pagen=2" target="_blank" rel="noopener">20 October</a> this year, FGV sought to clarify the LLA agreement following various ongoing news reports about the possible termination of the LLA.  FGV said FELDA had yet to contact FGV to negotiate matters regarding the LLA.
Under the terms of the agreement, termination of the LLA is allowed. However, it is understood FGV’s compensation would be assessed on the average profit/mature hectare for the entire leased land, multiplied by the loss of FGV’s future profits.
FGV currently manages 493,750 ha of land, therefore the LLA accounts for ~70% of FGV's plantation.
FGV followed up on the <a href="https://www.fgvholdings.com/press_release/official-statement-of-fgv-holdings-berhad-on-feldas-recovery-plan-termination-of-land-lease-agreement-lla/?pagen=1" target="_blank" rel="noopener">29 October</a> reiterating it had yet to receive a written notice from FELDA regarding the termination.
Led by Tan Sri Abdul Wahid Omar, who headed a special task-force - and who is also chairman of Bursa Malaysia - FELDA <a href="https://www.astroawani.com/berita-bisnes/felda-akan-ambil-tanah-dan-beli-kilang-dari-fgv-266002?fbclid=IwAR1M9Hmap92N5Tq_64AlsI-od2N1DZ6nOGOmKcooPzOLj-0chhwR_p0oMZo" target="_blank" rel="noopener">announced</a> on the 30 October the termination of the LLA. Two days prior, Datuk Sri Mustapa Mohamed - Minister in the Prime Minister Department for Economic Affairs - announced that the Cabinet had agreed to the recommendation (tabled by the task-force on the 14 October) to the termination of FELDA’s LLA with FGV.
<h3>The New News</h3>
FELDA announced a possible <a href="https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3112207" target="_blank" rel="noopener">mandatory takeover</a> of FGV at RM1.30/share. 
FELDA, which currently owns a 21.24% stake in FGV, entered into conditional sale and purchase agreements (SPAs) to buy the 6.1% and 7.78% stakes held by Kumpulan Wang Persaraan (Diperbadankan) and Urusharta Jamaah Sdn Bhd for RM658mn. Upon completion,  FELDA would hold 35.12%, which is above the 33% mandatory takeover offer threshold.
FELDA added that in conjunction with parties acting in converts (PACs), it would hold more than 50%. The names of these PACs were not made public. The conditions to the agreements are primarily one of funding and are expected to be completed within 3 months. 
FELDA intends to serve the mandatory offer notice on FGV once the SPAs have completed.
More below the fold.

On the 1 November 2011, FGV Holdings Bhd (FGV MK) signed a Land Lease (LLA) Agreement with Federal Land Development Authority (FELDA), whereby 351,000 ha of FELDA’s land was leased to FGV for 99 years.
On the 20 October this year, FGV sought to clarify the LLA agreement following various ongoing news reports about the possible termination of the LLA.  FGV said FELDA had yet to contact FGV to negotiate matters regarding the LLA.
Under the terms of the agreement, termination of the LLA is allowed. However, it is understood FGV’s compensation would be assessed on the average profit/mature hectare for the entire leased land, multiplied by the loss of FGV’s future profits.
FGV currently manages 493,750 ha of land, therefore the LLA accounts for ~70% of FGV's plantation.
FGV followed up on the 29 October reiterating it had yet to receive a written notice from FELDA regarding the termination.
Led by Tan Sri Abdul Wahid Omar, who headed a special task-force - and who is also chairman of Bursa Malaysia - FELDA announced on the 30 October the termination of the LLA. Two days prior, Datuk Sri Mustapa Mohamed - Minister in the Prime Minister Department for Economic Affairs - announced that the Cabinet had agreed to the recommendation (tabled by the task-force on the 14 October) to the termination of FELDA’s LLA with FGV.
The New News
FELDA announced a possible mandatory takeover of FGV at RM1.30/share. 
FELDA, which currently owns a 21.24% stake in FGV, entered into conditional sale and purchase agreements (SPAs) to buy the 6.1% and 7.78% stakes held by Kumpulan Wang Persaraan (Diperbadankan) and Urusharta Jamaah Sdn Bhd for RM658mn. Upon completion,  FELDA would hold 35.12%, which is above the 33% mandatory takeover offer threshold.
FELDA added that in conjunction with parties acting in converts (PACs), it would hold more than 50%. The names of these PACs were not made public. The conditions to the agreements are primarily one of funding and are expected to be completed within 3 months. 
FELDA intends to serve the mandatory offer notice on FGV once the SPAs have completed.
More below the fold.

SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Thematic (Sector/Industry)

<ul><li>In 2016, Singapore’s Consumer Staples Sector surged 25.8% on a capitalisation-weighted total return basis. There was a degree of consistency in the returns of the 10 biggest stocks of the Sector with total returns averaging 28.9%. </li><li>Among the 10 biggest stocks of the Consumer Staples Sector, the three best performers were <a href="https://www.smartkarma.com/entities/15597" target="_blank" data-smartkarma-citation="entities:15597">Japfa Ltd (JAP SP)</a>, <a href="https://www.smartkarma.com/entities/20972" target="_blank" data-smartkarma-citation="entities:20972">Super Group Ltd (SUPER SP)</a> and <a href="https://www.smartkarma.com/entities/1142" target="_blank" data-smartkarma-citation="entities:1142">Golden Agri Resources Ltd (GGR SP)</a>. For the nine months ending 30 Sep 2016: Japfa reported operating profit of US$268.4 million, up 90% from a year ago; while GAR reported profit attributable to owners of the company at US$353.3 million compared to a loss of US$9.2 million a year ago.  Super Group was subject to a proposed acquisition by the world’s leading pure-play CPG coffee company, priced at a 62.5% premium to the preceding close.</li><li>The next two best performing sectors were Materials and Information Technology which generated capitalisation-weighted total returns of 17.3% and 14.5% respectively. All Singapore’s key GICS® Sectors generated gains in 2016, with Energy generating the smallest of the gains at 0.9%. </li></ul>

In 2016, Singapore’s Consumer Staples Sector surged 25.8% on a capitalisation-weighted total return basis. There was a degree of consistency in the returns of the 10 biggest stocks of the Sector with total returns averaging 28.9%. Among the 10 biggest stocks of the Consumer Staples Sector, the three best performers were Japfa Ltd (JAP SP), Super Group Ltd (SUPER SP) and Golden Agri Resources Ltd (GGR SP). For the nine months ending 30 Sep 2016: Japfa reported operating profit of US$268.4 million, up 90% from a year ago; while GAR reported profit attributable to owners of the company at US$353.3 million compared to a loss of US$9.2 million a year ago.  Super Group was subject to a proposed acquisition by the world’s leading pure-play CPG coffee company, priced at a 62.5% premium to the preceding close.The next two best performing sectors were Materials and Information Technology which generated capitalisation-weighted total returns of 17.3% and 14.5% respectively. All Singapore’s key GICS® Sectors generated gains in 2016, with Energy generating the smallest of the gains at 0.9%. 

2016 – a Solid Year for STI Consumer Stocks

§ The 10 biggest SGX-listed F&amp;B plays average a market cap of S$3.5 billion, and averaged a 23% gain in the 2016 year through to 26 August. Japfa, Thai Beverage PCL and Jumbo Group were the strongest performers of the 10.§ The next 10 biggest SGX-listed F&amp;B plays average a market cap of S$153 million, and also averaged a 23% gain in the 2016 year through to 26 August. Food Empire Holdings and Katrina Group were the amongst strongest performers of the 10.§ Katrina Group was incorporated in 1995…

§ The 10 biggest SGX-listed F&amp;B plays average a market cap of S$3.5 billion, and averaged a 23% gain in the 2016 year through to 26 August. Japfa, Thai Beverage PCL and Jumbo Group were the strongest performers of the 10.§ The next 10 biggest SGX-listed F&amp;B plays average a market cap of S$153 million, and also averaged a 23% gain in the 2016 year through to 26 August. Food Empire Holdings and Katrina Group were the amongst strongest performers of the 10.§ Katrina Group was incorporated in 1995…

Singapore's Strongest Food & Beverage Stocks in 2016 YTD

<ul>
<li>Industry Associations see ongoing transformation of Singapore’s F&amp;B industry as manufacturers look towards innovation, growth, and internationalisation.</li>
<li>The 10 biggest Packaged Foods &amp; Meats stocks in Singapore have averaged a 12.6% total return in the year thus far. This compared to 10.1% for Asia Pacific’s biggest Packaged Foods &amp; Meats stocks and 8.9% for the world’s biggest Packaged Foods &amp; Meats stocks.</li>
<li>
<a href="https://www.smartkarma.com/entities/19714" target="_blank" data-smartkarma-citation="entities:19714:1">Delfi Ltd (DELFI SP)</a>, <a href="https://www.smartkarma.com/entities/15597" target="_blank" data-smartkarma-citation="entities:15597:1">Japfa Ltd (JAP SP)</a>, <a href="https://www.smartkarma.com/entities/20972" target="_blank" data-smartkarma-citation="entities:20972:1">Super Group Ltd (SUPER SP)</a>, <a href="https://www.smartkarma.com/entities/9051" target="_blank" data-smartkarma-citation="entities:9051:1">Yeo Hiap Seng Ltd</a>…</li>
</ul>


Industry Associations see ongoing transformation of Singapore’s F&amp;B industry as manufacturers look towards innovation, growth, and internationalisation.
The 10 biggest Packaged Foods &amp; Meats stocks in Singapore have averaged a 12.6% total return in the year thus far. This compared to 10.1% for Asia Pacific’s biggest Packaged Foods &amp; Meats stocks and 8.9% for the world’s biggest Packaged Foods &amp; Meats stocks.

Delfi Ltd (DELFI SP), Japfa Ltd (JAP SP), Super Group Ltd (SUPER SP), Yeo Hiap Seng Ltd…


Key Drivers of the Packaged Food Industry

Malaysia

MSM Malaysia Holdings Bhd produces sugar products.  The Company produces, markets, and sells a wide range of sugars, ranging from white refined to brown sugar. MSM Malaysia operates refineries in Prai, Penang and Chuping, Perlis.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Msm Malaysia Holdings (MSM MK)

FGV (FGB MK): IFA Says Offer Not Fair

The Offer is opportunistic, however, the MTO is unconditional. Currently trading to terms - it was 2.4%/34.2% gross/annualised return, at the time...

David Blennerhassett

FGV Holdings: Reading the Palm Fronds

The government has agreed that the financial position of FELDA is untenable and that the terms of the LLA are unsatisfactory. I don't see how the...

David Blennerhassett

2016 – a Solid Year for STI Consumer Stocks

In 2016, Singapore’s Consumer Staples Sector surged 25.8% on a capitalisation-weighted total return basis. There was a degree of consistency in...

Singapore Exchange Ltd (SGX)

Singapore's Strongest Food & Beverage Stocks in 2016 YTD

§ The 10 biggest SGX-listed F&B plays average a market cap of S$3.5 billion, and averaged a 23% gain in the 2016 year through to 26 August....

Singapore Exchange Ltd (SGX)

Key Drivers of the Packaged Food Industry

Industry Associations see ongoing transformation of Singapore’s F&B industry as manufacturers look towards innovation, growth, and...

Singapore Exchange Ltd (SGX)

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)