Singer Malaysia And Seven Eleven Proposed Listing

Many years ago, 18 Jan 2006, to be exact, I wrote the following... I Do.. The Losers!

• So what's left for Intan Utlities?
  
  After scrapping their proposal to buy Berjaya Sports Toto shares, the company announced it plans to consolidate its business by selling all its non-core businesses and concentrate on its chain of 7-Eleven business.
  
  Sounds fair.
  
  But what about the market players who 'invested' in Intan based on their early announcement to buy shares in Berjaya Sports Toto? Without this share purchase, it would appear that the current share price is not justifiable given the historical poor earnings from Intan....
  
  They announced a deal, suddenly value was created.
  They rescinded the deal, suddenly value is destroyed.
  
  Such is the power of corporate exercises.
  
  Oh yes, in the share market, there's always winners and losers, and the losers in this "I Do.. I Don't" flip-flop controversy is Intan.
  
  But is the loser only Intan?

Many months later.. Intan was taken private.

• Vista to take Intan private for RM85.6m
  
  Intan Utilities Bhd’s single largest shareholder Vista Meranti Sdn Bhd, with a 57.7% stake, is taking the company private with an RM85.61 million voluntary general offer for the remaining shares at RM2.10 each.
  
  The cash offer price is a premium of about 10.53% to the five-day weighted average market price up to Monday (Sept 11) of RM1.90 per share. Yesterday, it closed four sen higher at RM1.88, with only 100 shares done.
  
  In a statement yesterday, Intan said Vista had submitted the de-listing proposal to its board to request the company to undertake a voluntary withdrawal of its listing from Bursa Securities.......

So Intan was taken private via a VGO worth about 85.6 million.

In another story, October 2006.

• Cosway minority shareholders prefer sale
  By Chong Jin Hun
  jinhun@nstp.com.my
  
  MINORITY shareholders of Cosway Corp Bhd want the direct-selling firm to be put up for sale rather than let its parent Berjaya Corp Bhd (BCorp) take it private.
  
  "It is a bad idea to take Cosway private as it is a good and profit-making company with a bright future. Investors like to invest in companies with good dividends and bonus issues," proxy holder William Woon told reporters after Cosway's annual general meeting in Kuala Lumpur yesterday.
  
  He said it would be better to put the company up for sale as competitive bidding can produce higher sale prices.
  
  Woon was commenting on BCorp's recent announcement that it is considering a proposal to buy the remaining shares it does not own in Cosway. BCorp currently owns 74.4 per cent in Cosway.
  
  Another shareholder, who spoke on condition of anonymity, said it is unfair for Cosway to be taken private as the group has done well financially, thanks to its strong shareholders' funds.
  
  "The company had earlier sold shares to minority shareholders, and now, when it is making money, it (BCorp) wants to take it back from the minority shareholders," he lamented.
  
  It was reported that BCorp's possible voluntary general offer may cost the group between RM105.8 million and RM123.5 million for the remaining 25.6 per cent it does not own in Cosway.
  
  The amount works out to between RM1.20 and RM1.40 per Cosway share, whose price had advanced 73.4 per cent this year.
  
  Shares of Cosway closed higher by one sen at RM1.07 yesterday, while BCorp shares were unchanged at 15 sen.
  
  In the year ended April 30 2006, Cosway's net profit grew 62 per cent to RM98.2 million on a smaller revenue increase of 5 per cent to RM1.12 billion.
  
  Net profit for the first quarter to July 31 2006 decreased 15 per cent to RM10.3 million, while revenue was down 35 per cent to RM180.4 million.
  
  The dip in earnings for the first three months was due to the deconsolidation of former subsidiary Dunham-Bush (M) Bhd, according to Cosway's filings to Bursa Malaysia.

Good point mentioned: "The company had earlier sold shares to minority shareholders, and now, when it is making money, it (BCorp) wants to take it back from the minority shareholders,"

So Intan Utilities was taken private.

So was Cosway.

Yesterday, Businesss Times had this article.

• Berjaya to list Singer, 7-11 via new unit
  
  Published: 2009/09/29
  
  BERJAYA Corporation Bhd has announced the proposed listing of Berjaya Retail Bhd, the listing vehicle for subsidiary Singer (Malaysia) Sdn Bhd and 7-Eleven Malaysia Sdn Bhd, on the main market of Bursa Malaysia.
  
  In a statement to Bursa Malaysia today, the group said B-Retail will be principally involved in the marketing and direct selling of consumer durables with instalment option schemes via Singer Group, and the operation of a chain of convenience stores via 7-Eleven Group.
  
  The proposed listing will be undertaken via the implementation of the following proposals:
  
  i) proposed disposal of Singer to B-Retail for RM360 million;
  ii) proposed acquisition of 7-Eleven by B-Retail for RM600 million;
  iii) proposed dividend-in-specie by BCorporation;
  iv) proposed offer for sale of B-Retail securities; and
  v) proposed listing of and quotation for ordinary shares of RM0.50 each in B-Retail and irredeemable convertible preference shares in B-Retail on the Main Market of Bursa Securities.
  
  The Singer and 7-Eleven acquisitions will be satisfied through a combination of assumption of debt and issuance of new shares.
  
  "The Proposed Listing will enable BCorp to achieve its objective of unlocking shareholder value and distributing to its shareholders via the Proposed Dividend-In-Specie thus enabling its shareholders to have a direct participation in the equity and envisaged growth of B-Retail Group," the company said.
  
  It added that following the Proposed Dividend-In-Specie, BCorp shareholders will directly hold securities in a prominent organization with strong brand values and good growth prospects without the need for any cash outlay.
  
  "The Proposed Listing will also enable B-Retail Group to gain access to the capital markets should it wish to raise funds for its future expansion and continued growth," it added.
  
  Barring any unforeseen circumstances, the Proposed Listing is expected to be completed in the quarter ending 31 March 2010.

How?

One minute, companies are listed. Next they are taken private. Now they wants relisting again.

Is our local stock market such a easy cheap, easy market where companies can list and delist and relist as per they like?

One minute in and one minute out!

How does one expect our market to attract quality funds to invest in our market when this keeps happening?

Now I also want to spare a moment for Intan Utlities and Cosway shareholders.

I am sure that they would be not happy to read such a development.

For Intan Utlities ex-minority shareholders, how much was they offered for their shares? How much does B-Retail wants to buy Seven Eleven for now? 600 million!

For Cosway ex-minority shareholders. Many had objected but yet the company was taken private. Now a subsidiary of its company, Singer Malayisa, is sold for how much now? 300 million!

How?

Can't help it but does it not look like the minority shareholders got the extra short end of the stick?

And what does this say about long term investing?

Yeah, some say it wouldn't work because long term investors always tend to get the short end of the stick.

However, some say, this is not true. Long term investors just needs to be really prudent. One cannot simply buy any company and declare it as long term investing! Or as some would say, never be a shareholder of a business venture if you cannot trust your partners!