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WHY DO I THINK RTO OF SCGM IS A CERTAINTY ?

Just88
Publish date: Fri, 23 Feb 2024, 03:49 PM

WHY DO I THINK REVERSE TAKEOVER (RTO) OF SCGM BY ERAMAS GROUP IS A CERTAINTY ?

  • In early Jan 2023, the owners of Eramas group of companies has acquired the controlling stake from the founders of SCGM at a premium price to Net asset value.
  • The founders of SCGM retained a minority stake in SCGM as they wish to invest in the future of coconut business.
  • The emergence of few significant investors both retailers and foreign institutions suggests their awareness of acquisition of coconut assets. 
  • In late 2023, SCGM changed its financial year end to 31st December in line with the financial year end of Eramas group of companies to facilitate merger accounting.
  • Coconut business is currently booming and expansion requires additional capital and SCGM has a cash pile of RM118 millions.
  • Thai Coconut public company which was listed in 2023 was well received by investors with hefty valuation of more than 20 times price earnings.
  • If SCGM fails to regularise its operation, it will be delisted and the new shareholders will suffer losses.

SCGM has finalised its 2023 financial accounts, announcement of proposed acquisition should be near.


Just88

*** I do own the stock. This is not a buy call and decide at your own risk.


 

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Alibone

Just88, thanks for sharing. Looks like some insiders are already buying ??

1 month ago

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