those holding mother shares could get back your capital plus yields for the 3 years but those holding warrants could loss everthing like what SONA warrantholders does......caution.
Yes watchout ....as the current financial environment is not so rosy, major SH could opt for cash rather than stay invested with a newly acquired company..
From what I read, Double-V Series Sdn Bhd, the Tan brothers’ holding company, currently owns a 70% stake in Munchy’s with the remaining 30% held by fund investor Tap Crunch Sdn Bhd. Rsena has to acquire at least 51% of munchy to qualify for QA.
Not sure if Tan brothers want to give up control..... Unless they remain the controlling shareholders which can be done thru share swap. In which case, the 20% shareholdings of the promoter will be diluted.....
In the financial year ended Dec 31, 2015, Munchy’s posted a net profit of RM41.34 million. Assuming 20% profit growth for 2016 and 2017, its net profit would be around RM60m At 15x PE, it is worth about RM900m. Rsena has less than RM400m. How to make it happen ?
Maybe RM400m cash + 1.1b new shares at RM0.50 each will make it happen. Tan brothers retain control with 52+% ownership. However, I m not sure whether this kind of arrangement will be approved by the SC.
If Munchy selling just 5 to 8x PE, Rsena's Management should not be worried about the high valuation sought by the seller. Why would Tan Brothers be selling Munchy at such low valuation when it can go for listing at higher than 15x PE, considering the current high PE regime for the listed F&B stocks.
Tan brothers had 30 - 40% revenue growth target for Munchy in 2017. With such high growth rate, I m doubtful, even 15x PE could entice them to part an empire they build for 25 years. They sold 30% ownership each to KWAP and TAP in Oct 2014, later restructured in 2015 to see Double-V Series Sdn Bhd, the Tan brothers’ holding company, owns a 70% stake in Munchy’s with the remaining 30% held by fund investor Tap Crunch Sdn Bhd. In a 2016 report, KWAP said it has a 15% exposure in Munchy. Does it mean that Tan brothers bought back 15% each from KWAP and TAP, or was there a corporate exercise to dilute their shareholdings ? If Tan brothers were increasing their stake in Munchy in 2015, why would they want to sell to Rsena now ?
To Rsena, Munchy as QA, at reasonable valuation, would certainly increase its odd of getting the shareholders' approval. Munchy is still on high trajectory growth path which will attract venture capitals and fund managers investments to buy out the yield investors.
Impossible is nothing in corporate games! IF if if the Tan bros had its proxy already holding a substantial stake in R sena and Warrants The Tan bros. will allow R sena to QA controlling stake of 5!% .
those holding mother shares could get back your capital plus yields for the 3 years but those holding warrants could loss everthing like what SONA warrantholders does......caution.
If Rsena can't find anything worth buying, better don't waste money on all the paper works. If all returned, shareholders can get exta1.8 cents on top of the cash in the trust account.
But I don't think the promoters will lay down without a fight. Although the valuation of the QA target may not be cheap, but it also speaks well of the future prospects of the F&B industry. Good industry prospect is vital to the success of SPAC. That is why we had 4 SPACs listed during the US$100 oil regime.
Rsena warrant is very high risk. If QA fails, it is worthless. But if it succeeds, warrant can double/triple or more. Only invest with money you can afford to lose.
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....
TanChinku
188 posts
Posted by TanChinku > 2018-03-30 09:59 | Report Abuse
This could the first FB spac successful in Qa, congrats to all believer.