I think the price is not an issue. Can Sarawak get consent from the Finance Minister to hold a stake, a comfortable stake whereby Sarawak can determine how the bank operates.
Affin keeps on impressing.. one of the best investments I had. Especially the fact that they do DRPs is in itself and added value to the stock. I wish other companies had the same policy.
Already over 2 weeks since the leak that Sarawak negotiating to buy additional 15% stake in Affin. Now it's quiet, has negotiation broken down? LTAT wants a higher price but Sarawak offering peanuts.
surely there will be a deal its just at what price and will there be a GO... let's wait... no risk its a bank anyway regulated by BNM. unless u don't trust BNM than don't buy shares.
#contrarian, I agree what's reported is 15% but why does Swak Gov want to remain the 3rd largest shareholder when they have a "once in a life time" chance to be the largest. the sale of 15% is just 330M shares, which is not enought to pay LTATs debts.
I have never trusted Kenanga's TPs. That is after monitoring their research for over 10 years now. As for EPF, the urgency is urgent and cannot wait for any Sarawak deal or a target price. They need the money now, not tomorrow, hence they are selling. If it's a sign for anything, it's a sign that they are desperate. EPF is not supposed to be a daily trader, but a fund.
to answer why EPF selling. If U had 1M shares bought at avg of below 2.00 wouldnt U sell at least 5% or 50K shares at 2.40 and reduce position. sell another 5% at 2.60 and so on. this is called trimming position.
any deal has a chance to be terminated so if U a long term investor, it is best to trim as the price goes up and the balance for the KILL.. if the deal gets terminated, u still have the position to buy when it drops. this is simple risk management.
The kenanga article of valuing Affinbank at absurb Rm 1.90 has ulterior motive of depressing Affin price loh!
U ask yourself who is the biggest shareholders of Kenanga......answer Swk Govt loh! Thus valuing affin bank serve the Swk Govt objective thus Kenanga valuation unreliable mah!
Put it this way loh! .Affin has this financial info per share loh!
1. NTA Rm 4.70 2. EPS Rm 0.24 3. Div per share Rm 0.125.
Thus if u r the acquiring party taking a controlling block, it is far u pay a reasonable attractive price for Affin which is price to book value of at least 0.7x which work out to Rm 3.30.
Thus PE of affinbank around 13.7x. Div yield 3.8%
As Affin bank is acquired at a discount of Rm 3.30, what need to do is to improve the current ROE of Affin of 4.6% to 7.5% and that will improve the eps of affin bank from rm 0.24 to Rm 0.39 loh!
With Eps of 39 sen....that will more than justify the acquisition price of Rm 3.30 at pe 8,5x loh!
BPlant & Bstd GO cost abt 1.9B to LTAT. LTAT has abt 690M Affin. at 2.80 to 3.00 can pay off the GO Loan. Not sure if LTAT need more money to pay DV to their contributors/army.
Federal government aiding LTAT in the MGO of Boustead and Bplant. LTAT doesn't need to give up Affin but need money to pay good dividend to its members.
Sarawak government is buying the banking group not for investment but strategic reasons so any price below NTA will be a good bargain for them. Affin Bank is a small bank but it's Investment Bank is not a small player but a big player in stock market.
AffinHwang Asset Management was sold to world largest hedge fund CVC and AffinHwang Investment Bank, still owned by Affin Bank. Half of the AI chips produced by Nvidia shipped to Singapore and Singapore is buying Gigawatt of power supplies through undersea cable from Sarawak. When we put together all the information you can see something big is brewing behind the scenes. AffinHwang Investment Bank is the largest stockbroker in Malaysia with an established business network. Sarawak must shift to high gear to accumulate Affin Bank shares in the open market or else someone else will and eventually become a hostile takeover drama.
LTAT and Boustead currently owns close to 50% , so there's no way of an hostile takeover. The only takeover is one that's decided by the Federal government such as Maybank or CIMB or RHB or even MBSB taking over Affin. Then it will be done at a price of at least 1 time book value.
There is no hostile takeover loh! Whoever wants to buy substantial Affin bank, need friendly cooperations with LTAT loh!
Posted by TheContrarian > 32 minutes ago | Report Abuse
LTAT and Boustead currently owns close to 50% , so there's no way of an hostile takeover. The only takeover is one that's decided by the Federal government such as Maybank or CIMB or RHB or even MBSB taking over Affin. Then it will be done at a price of at least 1 time book value.
Affin Bank is the smallest bank in Malaysia so it is kind of interesting that it has attracted the attention of the Sarawak government. Sarawak is the most powerful state in Malaysia which is asking to increase their parliament seats to more than 30%. With this kind of political ambition it is unlikely that Sarawak will be pleased with only a five percent stake in Affin Banks.
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
TheContrarian
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Posted by TheContrarian > 2024-01-19 08:58 | Report Abuse
Sarawak wishes for a bank ...... their very own bank ....... the closest to getting a bank is holding a substantial stake in a small bank like Affin.