Journey to Wealth
SEG International - OUTPERFORM - 06 June 2012
News As of 4th of June, the acceptance level for the unconditional take-over offer by Pinnacle Heritage Solutions S/B stood at 64.33% and 63.70% for SEG ordinary shares & warrants respectively.
In other words, the offers merely received 0.36% and 16.91% acceptance rates from SEG ordinary and warrant shareholders respectively. The acceptance of the Offer has been extended from 6 June 2012 to 20 June 2012.
To recap, Pinnacle Heritage Solutions S/B has tabled a cash offer price of RM1.714 and RM1.214 per SEG Share and Warrant respectively on 25 April 2012.
Comments The lacklustre response from the minority shareholders seems to echo our view of the unattractive offer price.
Based on the above uninspiring acceptance level trend, we reckon SEG stands a high chance of retaining its listing status post offer.
Outlook Remains bright underpinned by more new programmes to be introduced within this year (20-30 programmes) particularly from an increasing number of SEG University College's own home-grown programmes (e.g. medical sciences), which enjoy higher margins compared to other programmes.
Forecast FY12-FY13E remains unchanged.
Rating Maintained OUTPERFORM but we recommend minority shareholders to reject the GO of RM1.714.
Valuation No change in our SEG's fair value of RM2.19, based on a targeted FY12 PER of 12.5x (+1SD). We understand that the consensus is targeting a fair value of RM2.09 for SEG.
Risks High acceptance of the takeover offer will trigger a successful delisting.
Source: Kenanga
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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....
