Posted by Tipster > 2013-06-28 20:07 | Report Abuse

Whats the story?

KPS selling KHSB to PUNCAK?

Posted by hng33 > 2013-06-28 20:58 | Report Abuse

KPS announce higher take over price by KDEB for its stake in KHSB, up 10% from 76sen to 83.6sen. KPS stand to reap higher gain from divestment, up from RM 193.6m to RM213m or gain of 44sen/share

Posted by hng33 > 2013-06-28 21:13 | Report Abuse

雪州柏朗商獻購價提高至83.6仙　

（吉隆坡28日訊）雪洲政府投資臂膀雪州集團有限公司（KDEB），計劃斥資2億1281萬令吉或每股83.6仙，收購雪州柏朗商（KPS，5843，主要板貿易）56.57%股權。

　2家公司分別發布文告報備此消息，雪州集團公司宣布上修獻購價格，從原有每股76仙或總值1億9347萬令吉，提高至每股83.6仙。

　文告指出，獨立估價師對雪州柏朗商持有的有地房地產評估結果顯示，房產現價高達10億8510萬令吉，重估后淨資產值提高至每股1令吉，故決定上修獻購價。

　雪州柏朗商指出，脫售所得將用來償還貸款、展延經費、營運資本及尋找新投資項資金

Posted by hng33 > 2013-06-29 11:40 | Report Abuse

KPS will partly utilize the proceed from KHSB disposal to pay special dividend to shareholder.

Wah Wah.....

SPECIAL DIVIDEND : 26.67sen

Posted by hng33 > 2013-06-29 11:44 | Report Abuse

If take into account cum final dividend of 2 sen, total dividend payable will be as much as 28.67sen. Based on current share price of 1.42, the total cash dividend work out to more than 20% dividend return.

Posted by hng33 > 2013-06-29 12:22 | Report Abuse

For those still hold KHSB, Its better sell KHSB and swap it to buy KPS. The take over need a lot time to materialize, 3 to 6 month at least and upside cap to maximum1 10% or 83.6sen only. Whereas, KPS offer much better cash dividend as after disposal of its 56% stake in KHSB, KPS will used part of the proceed to reward shareholder by payout special dividend to shareholder, SPECIAL DIVIDEND : 26.67sen

If take into account cum final dividend of 2 sen, total dividend payable will be as much as 28.67sen. Based on current share price of 1.42, the total cash dividend work out to more than 20% dividend return.

KPS potential upside will further boosted if Selangor water restructuring can be seal by end of these year, turning KPS into net cash and likely another round of special dividend.

KPS also in the midst to buyback its Golf membership from its member and turning these Golf into Eco theme property development to be develop by JV between SP setia, in which KPS will entitle 13% return from total GDV or minimum of RM 200m

Posted by kcchongnz > 2013-06-29 12:33 | Report Abuse

If the whole exercise is completed in 3 months time, 10% return, when annualized equals to 40%, and in 6 months, 20%. This estimated return is basically risk-free now except for the consideration of time value of money. Where can one gets such good return with this kind of risk?

I offer to buy from anyone who wants to sell to me at 78 sen. Anyone?

Posted by Tipster > 2013-06-29 12:37 | Report Abuse

what does PUNCAK has in play in this episode?

Posted by hng33 > 2013-06-29 12:45 | Report Abuse

KPS vs. Puncak
Both also are Selangor water player, depending on outcome of water restructuring. Both stand reap handsome profit gain if materialize. However, KPS will most likely again to payout part of the proceed to shareholder as special dividend to help its ultimate holding company KDEB to fund the acquisition. Very similar to what have done now in KHSB, whereby, KPS use 40% cash proceed to declare special dividend to KDEB to part finance the acquisition in KHSB (right hand in, left hand out).

The proceed form disposal in KHSB is about RM 212m, KPS use about 40% or RM 97m already work to special dividend of 26.67sen or give yield of 18% risk free cash return.

Lets imaging if RM 1.6b water restructuring materialize, just use 20% proceed or RM 320m to payout as special dividend, it will work out as much as 65sen/share

Posted by Tipster > 2013-06-29 13:09 | Report Abuse

To KPS shareholders?

Posted by Tipster > 2013-06-29 13:13 | Report Abuse

KDEB is Selangor government vehicle?

Posted by Tipster > 2013-06-29 13:16 | Report Abuse

KDEB is the mother of KPS & KHSB...
KPS also shareholder of KHSB...
The relationship is so complicated...

Posted by hng33 > 2013-06-29 15:56 | Report Abuse

KDEB control 60% of KPS; KPS control 56% KHSB

After disposal
KDEB control 60% KPS and 56% KHSB directly

Posted by tq101012 > 2013-06-29 15:58 | Report Abuse

so this news wll boost the price on monday?

Posted by hng33 > 2013-06-29 16:07 | Report Abuse

What to think KPS share will response? 26.6sen special dividend give rise to 18% cash return. If take into account another final dividend of 2 sen, total cash return is more than 20% based on share price of just RM1.42.

Posted by tq101012 > 2013-06-29 16:17 | Report Abuse

hhng33, who will give 26.6c , KHSB or KPS?

Posted by hng33 > 2013-06-29 16:22 | Report Abuse

Off course is KPS, rewarding special dividend of 26.6sen to shareholder after disposal of its stake in KHSB. Please refer to bursa announcement, or read today sin chew newspaper.

Posted by tq101012 > 2013-06-29 16:25 | Report Abuse

ok..thank..

Posted by Tipster > 2013-06-29 16:34 | Report Abuse

just q la. if get then good else dun chase...

Posted by hng33 > 2013-06-29 16:36 | Report Abuse

That why i expect KPS should have more upside than KHSB, as take over process take more time to complete and limit to maximum 10% or 83.6sen offer price, whereas, KPS cash dividend offer 20% cash return and can still expect more special dividend to come if water restructuring can be seal by end of these year

Posted by kcchongnz > 2013-06-29 16:51 | Report Abuse

hng33, i read what you wrote about KPS and I agree with you just basing on your analysis. Good one.

But holding KHSB to conclusion of the takeover and earn an annualized return of 20-40% with almost no risk now and you throw that away, compared to KPS which is still subjected to the volatility of the market, local and abroad? Getting the high special dividend doesn't mean that you can get a high total return eventually. I mean from what you wrote and i kind of agreed there is high probability, but it is not a sure thing as KHSB's case.

Anyway, continue holding KHSB shares and buying KPS shares is not mutually exclusive thingy. Why have to sell KHSB?

Posted by hng33 > 2013-06-29 17:36 | Report Abuse

For KDEB to make unconditional offer to take over KHBS, it must first complete acquisition of 56% stake from KPS, to trigger mandatory take over code. Therefore, the EGM have to call for KPS first to seek shareholder approval + special dividend payable to shareholder of KPS. Only after KPS secure shareholder approval in the upcoming EGM, for KDEB to complete acquisition of its 56% no later by 26 July. Once complete, KPS will payout special dividend of 26.6sen to shareholder and at the same time KDEB trigger take over code and extend MGO to take over remaining stake in KHSB from minority shareholder. KHSB itself have to call EGM for themselves to seek shareholder approval to be take over by KDEB.

If one to hold KHSB at 76sen and wait till take over by KDEB at 83.6sen, the maximum return is 10%. Either in 3 month or 6 month, the return still remain as 10%. If wanna to calculate annualized return of 20 or 40%, you have to have another few more similar stock like KHSB that offer 10% again to be continue continue

Posted by hng33 > 2013-06-29 17:46 | Report Abuse

If you talk about sure thing about 10% return at KHSB and to KPS special dividend which is still subjected to the volatility of the market, local and abroad? You must make thing correct first, KDEB must first complete acquisition of KPS stake in KHSB, only then it will extend offer to remaining minority shareholder at 83.6sen.

Posted by hng33 > 2013-06-29 17:56 | Report Abuse

雪州集團全購雪州產業
2013-06-29 11:21

（吉隆坡28日訊）雪州集團提高向雪州柏朗桑（KPS,5843,主板貿服組）全面獻購雪州產業（KHSB,6246,主板產業組）股權價格從每股76仙至83.6仙，相等於總值2億1千281萬4千314令吉，並將派發每股26.67仙特別股息予股東。

雪州柏朗桑發文告表示，獨立估值師WTW產業顧問公司根據截至2012年12月31日止財政年市值進行評估，發現公司股票價值達到每股1令吉47仙，為其重估淨資產值（RNAV）折價43.13%，因此在考量相關因素後，董事部去函雪州集團要求對股票脫售計劃進行修正，並獲得後者同意。

不過，雖然全購價比RNAV折價43.13%，但仍較每股68仙淨資產值溢價22.94%，甚至比5日、1個月、3個月、6個月和1年成交量加權平均市價溢價49.29%至125.95%。

基於全購價獲得上調，雪州柏朗桑也將對脫售所得資金用途進行修改，其中1千805萬9千令吉將用作償還貸款、3千833萬1千令吉營運資本、5千611萬6千令吉作為新投資，其餘9千920萬8千令吉，或相等於每股26.67仙將用作派發特別股息。

雪州柏朗桑是在今年2月中接獲雪州集團的獻議書，以收購手中雪州產業的56.57%股權，交易總值達1億9千346萬7千558令吉，每股為76仙。（星洲日報／財經）

Posted by kcchongnz > 2013-06-29 18:03 | Report Abuse

I am not talking about "sure thing", nothing is 100% sure in investment, but it is "quite sure" as it is now and just a matter of time. Don't you agree? Same for your special dividend of 26.6 sen for KPS shareholders. But after receiving the special dividend, there is uncertainty if KPS's share price can maintain at the present price less the special dividend. It is subject to the volatility of the share market.

Would you prefer to receive the 10% return in three months time, or at the end of 12 months time? Basic concept of time value of money.

Posted by hng33 > 2013-06-29 18:20 | Report Abuse

KHSB contribute not only nothing to KPS earning, but because of its loss and liability, it have burden KPS balance sheet.

On paper, KPS will get RM 212m for disposal of its stake in KHSB, but in actual KPS will recording more than that

1. The actual a gain in accounting from disposal is RM 335.7m due to write back of past provision on KHSB.

2. KDEB will fully settle inter company balance due and owing by the KHSB totally about RM 36.2m

3. KPS will need to provide any corporate guarantees and indemnities to financial institution in respect of borrowing granted to KHSB, amounting to RM 99m

4. KPS will not need to record the material contingent liability of KHSB amounting to RM 405m.

In total, once the disposal is complete, KPS balance sheet will have significant improvement, and will reflect in its NTA to be increase from current RM2.43 to almost RM3. If without declare special dividend, it will also due for re-rating

Posted by hng33 > 2013-06-29 18:28 | Report Abuse

Q: Would you prefer to receive the 10% return in three months time, or at the end of 12 months time?

A: 10% return in 3 month time don't translate itself to annualized return of 40%. It do, only if you able to record quarterly return of 10% in 4 consecutive quarter. Which mean you need to get 4 stocks consecutively with each have potential return of 10% pa, then cumulatively give rise to 40% pa .

Posted by kcchongnz > 2013-06-29 18:46 | Report Abuse

When one talks about return, it normally means annualized return, or compounded annual return. That is the basic concept of finance.

Yes, it doesn't mean you can get 40% return in a year, unless you keep on invest in another KHSB. Agreed.

But can't i use the money which I receive in say three months time and invest in say ASN and get another say 6% return, for a total return of about 16% a year which is of little risk? Where else can you get that kind of return with that little risk?

All I am saying is the risk return reward for not selling KHSB at the present price of 76 sen is attractive. Whereas the expected "total return" for KPS has more uncertainty. Yes, you receive the special dividend of 26.6 sen and share price would be adjusted downwards after special dividends. And how sure are you KPS's share price won't drop below say 1.25 if say the world markets drop, amy be due to higher interest rate, higher inflation, another sublime crisis, China gone into trouble etc etc?

Didn't I say holding KHSB share and buying KPS is not mutually exclusive?

Posted by iafx > 2013-06-29 19:49 | Report Abuse

@hng, true that limited up side for khsb, but u never know till egm is over.v will c how much that 1.42 been factored in for the sp soon :D

Posted by Metta > 2013-06-29 23:30 | Report Abuse

Thanx so much hng and kcchong for both ur informative debate. Very enlightening. Taking all ur pts into consideration, v hv now to decide for ourselves .. wonder if its right for me to conclude .. To hv a bird in hand or two birds in d bush ????

Posted by Ooi Teik Bee > 2013-06-29 23:57 |

Post removed.Why?

Posted by Grandma > 2013-06-30 00:39 | Report Abuse

Grandma likes OTB plan. OTB is like Hannibal of the A-Team. He likes a good plan when it comes together. If can connect the dotted lines it will b smooth sailing

Posted by tank > 2013-06-30 00:48 | Report Abuse

Dear OTB,
But to get 83 sen for KHSB, you might need to wait another 3 -6 months. By Monday KHSB might go up to .78/.79 and to get additional 4 sen you need to wait another 3/6 months. I tend to agree with hng33 that you sell KHSB now and buy KPS because the upside potential for KPS is huge.

Posted by iafx > 2013-06-30 10:09 | Report Abuse

see page 4, estimated timeframe from the completion of the Proposed Disposal for special dividend is also 3 months. it may as well announce in 3 months, payout after Nov (next qtr report). in between this period, anything new and exciting foreseen from kps? maybe, but best wait till the egm is over.

next week kps stands good chance breaking $1.5, but whether it can sustain that level is another question.

Posted by hng33 > 2013-06-30 12:50 | Report Abuse

KPS uptrend remain, ready to record another year high with the next resistance level at RM1.60 follow by RM1.80

Posted by hng33 > 2013-06-30 12:55 | Report Abuse

KPS will like announce notice of EGM to seek shareholder approval for to dispose its 56.6% stake in KHSB, probably held EGM before 26 July as it the last date to complete the disposal. Thereafter, within 3 week to complete special dividend of 26.6sen payout to shareholder, which like declared these special dividend in Aug, ex-date in Sept and payment date in Oct.

Posted by tank > 2013-06-30 13:49 | Report Abuse

Anything below 1.60 for KPS is a good buy because of the 20 sen dividend (net). Also there are positive development on the water issues which should further push up the price of KPS.

Posted by hng33 > 2013-06-30 14:09 | Report Abuse

KPS other pending for sale aside KHSB

1. 90.83% stake in Titisan Modal which hold 100% stake in Konsortium ABASS

2. 30% stake in SPLASH

Both pending Selangor water restructuring outcome. If the deal can be seal by end of these year, offer take over price from KDEB worth RM 1.6b will turning KPS into net cash and likely another round of special dividend.

3. 20% stake in Spirit highway (SISTEM PENYURAIAN TRAFIK KL BARAT HOLDINGS SDN BHD)

4. KPS through 99.98% stake in Cash Band is in the midst to buyback its Golf membership from its member and turning these Golf into Eco theme property development to be develop by JV between SP setia, in which KPS will entitle 13% return from total GDV or minimum of RM 200m

Posted by iafx > 2013-06-30 14:26 | Report Abuse

therefore, no need to rush :) juz like khsb deal, long and never short of up/down, plenty of buy opportunities

Posted by tank > 2013-06-30 16:55 | Report Abuse

RM1.6B proceeds from sales of equity in water companies? that's a lot of money. assuming KPS just get 30%(after paying all the borrowings and liabilities) or RM480 million. More than RM1 per share! Provided my assumption is right and the deal goes thru..

Posted by nightrader > 2013-06-30 17:12 | Report Abuse

wow u guys make KPS so tempting....

Posted by tank > 2013-06-30 22:02 | Report Abuse

KPS is quite generous in giving out the special dividend. They have agreed to give almost half of the proceeds from the sales of KHSB as special dividend.(RM99 million out of RM212 million). If they continue to use the same formula for future water proceeds, you can expect astronomical special dividend from KPS. Based on the potential figure I suggested earlier, the dividend is tempting indeed..

Posted by moneyking96 > 2013-06-30 22:07 | Report Abuse

Tmr will up to 1.6?

Posted by tank > 2013-06-30 22:27 | Report Abuse

I'm not sure about that. But KPS value is much higher than 1.60

Posted by hng33 > 2013-06-30 22:30 | Report Abuse

KDEB has 60% stake in KPS, the largest beneficial for special dividend. KPS need to payout special dividend in order to assist its holding company KDEB to make MGO for remaining stake in KHSB from minority shareholder. Similarly, if KPS opt to divest all its water concessionaire to KDEB for RM 1.6b, KPS will need to later opt to payout special dividend again to KDEB for it to extent offer to acquire other water asset from Puncak (70% in syabas) and Gamuda (40% stake in splash)

Posted by tank > 2013-06-30 22:44 | Report Abuse

hng33 is right. So, small investors like us shall again benefit in the process thru bumper dividend. As of now, KPS is a much better choice than KHSB..

Posted by iafx > 2013-07-01 09:01 | Report Abuse

opening indicates market ALREADY factored in the good news. unless big fund coming in for new catalyst, doesn't like going anywhere soon, let's wait for carnival sales :)

Posted by hng33 > 2013-07-01 09:34 | Report Abuse

Profit taking set in, lets wait a bit longer for EGM to be call soon. KPS hidden gem is awaiting to be discover

Posted by hng33 > 2013-07-01 10:28 | Report Abuse

KPS buying support also getting more momentum, hopefully it can break its year high of RM 1.46 today, and toward EGM breaking resistance level at 1.60

Posted by hng33 > 2013-07-01 12:23 | Report Abuse

Ya!, KPS after breaking year high level at 1.56, it next challenge is RM 1.60