Yoma is acquiring an 80% interest in a 10-acre site in central Yangon for S$99.16m. We believe this to be a reasonable price in the lower half of our range of estimates. The development is envisioned to be a mixed-use project consisting of residential, retail, hospitality and commercial components with a GFA of approximately two million sq ft. Under the existing share issue mandate, Yoma will undertake a 1-for-4 rights issue for up to ~289m new shares to finance the acquisition at a 25%-35% discount to the closing price at a date to be determined. The timing of the issue, dependent on shareholder approval of the acquisition, is likely to be in 1Q13. In addition, Yoma also announced that it would carry out a private placement of 193m new shares at S$0.525 each to raise S$101m. After accounting for the accretion from this acquisition and potential dilution from the capital raising, our fair value estimate, based on a scenario-based RNAV methodology, increases marginally to S$0.52 from S$0.51. Maintain HOLD.
Proposed acquisition of central Yangon site
Yesterday, Yoma proposed to acquire from SPA (Myanmar) Ltd, an 80% interest in a 10-acre site in central Yangon for S$99.16m (US$81.28m). We believe this to be a reasonable price in the lower half of our range of estimates. The development, situated between Trader’s Hotel and Bogyoke Aung San Market, is envisioned to be a mixed-use project consisting of residential, retail, hospitality and commercial components with a GFA of approximately two million sq ft.
An envisioned iconic mixed development
The site currently holds FMI Centre Tower and the former Railway Headquarters – a well-known heritage building in Yangon. Under current plans, the Railway Headquarters would be converted into a luxury hotel, to which a condominium building would be adjoined. The development would also consist of a 4-star hotel and serviced apartment complex, two Grade A office towers with over 700k sq ft of GFA, and a retail mall with over 400k sq ft GFA.
1-for-4 rights issue likely to be in 1Q13
Under the existing share issue mandate, Yoma will undertake a 1-for-4 rights issue for up to ~289m new shares to finance the acquisition at a 25%-35% discount to the closing price at a date to be determined. The timing of the issue, dependent on shareholder approval of the acquisition, is likely to be in 1Q13.
Private placement to raise an additional S$101m
In addition, Yoma also announced that it intends to carry out a private placement of 193m new shares at S$0.525 each that would raise S$101m. Note these placement shares are entitled to participation in the proposed rights issue. This is to further finance the project development, estimated at US$330m-S$350m and expected to be carried out in phases.
Maintain HOLD at S$0.52 FV
After accounting for the accretion from this acquisition and potential dilution from the capital raising, our fair value estimate, based on a scenario-based RNAV methodology, increases marginally to S$0.52 from S$0.51. Maintain HOLD.
Yesterday, Yoma proposed to acquire from SPA (Myanmar) Ltd, an 80% interest in a 10-acre site in central Yangon for S$99.16m (US$81.28m). We believe this to be a reasonable price in the lower half of our range of estimates. The development, situated between Trader’s Hotel and Bogyoke Aung San Market, is envisioned to be a mixed-use project consisting of residential, retail, hospitality and commercial components with a GFA of approximately two million sq ft.
An envisioned iconic mixed development
The site currently holds FMI Centre Tower and the former Railway Headquarters – a well-known heritage building in Yangon. Under current plans, the Railway Headquarters would be converted into a luxury hotel, to which a condominium building would be adjoined. The development would also consist of a 4-star hotel and serviced apartment complex, two Grade A office towers with over 700k sq ft of GFA, and a retail mall with over 400k sq ft GFA.
1-for-4 rights issue likely to be in 1Q13
Under the existing share issue mandate, Yoma will undertake a 1-for-4 rights issue for up to ~289m new shares to finance the acquisition at a 25%-35% discount to the closing price at a date to be determined. The timing of the issue, dependent on shareholder approval of the acquisition, is likely to be in 1Q13.
Private placement to raise an additional S$101m
In addition, Yoma also announced that it intends to carry out a private placement of 193m new shares at S$0.525 each that would raise S$101m. Note these placement shares are entitled to participation in the proposed rights issue. This is to further finance the project development, estimated at US$330m-S$350m and expected to be carried out in phases.
Maintain HOLD at S$0.52 FV
After accounting for the accretion from this acquisition and potential dilution from the capital raising, our fair value estimate, based on a scenario-based RNAV methodology, increases marginally to S$0.52 from S$0.51. Maintain HOLD.
No comments:
Post a Comment