Kudos To CapitaLand
You gotta hand it to the folks at CapitaLand: when it comes to getting a good deal they don’t let anything stand in their way – even if they are both buyer and seller.
Raffles Holdings’ sale of the Raffles City shopping centre, office block and hotel was done at a price that is likely to keep everyone happy:
Raffles Holdings gets S$435.1 million for its 45% share in Tincel Properties (Private) Limited, the company that owns Raffles City. The junior bond holders in Tincel, which own the other 55% are likely to get the rest.
Combined with the almost S$594 million in cash and equivalents on the balance sheet at the end of calendar 2005, a payout of more than S$1 billion awaits.
The buyers of Raffles City – CapitaCommercial Trust and CapitaMall Trust – are also part of the CapitaLand stable, but that didn’t mean they got a free kick.
Paying S$2.085 billion – plus another S$81 million in development costs – for an asset that Raffles Holdings said on February 11 this year was on the books at S$1.62 billion is a pretty good deal.
The two REITs, who are yet to get shareholder approval for the deal, will still pick up Raffles City at a yield around 5%.
Another positive about the CapitaLand group is its level of disclosure.
While some Government-Linked Companies meet their statutory requirements but are otherwise at best reticent to disclose useful information, CapitaLand communicates considerably more with its shareholders.
For example, the announcement of the Raffles City sale was made on Sunday afternoon, giving the media enough time to include the story in the Monday morning papers.
Each CapitaLand entity made its own separate announcement, rather than a one-statement-fits all approach.
And Raffles Holdings, after a newspaper story hinting that a Raffles City sale was imminent, disclosed February 11 that it was leaning towards a sale.
That’s certainly an improvement on the common but useless “we don’t comment on market rumour” line.
So, who do YOU think got the best deal?
The REITs? Raffles Holdings? Or CapitaLand.
I look forward to your comments.
Raffles Holdings’ sale of the Raffles City shopping centre, office block and hotel was done at a price that is likely to keep everyone happy:
Raffles Holdings gets S$435.1 million for its 45% share in Tincel Properties (Private) Limited, the company that owns Raffles City. The junior bond holders in Tincel, which own the other 55% are likely to get the rest.
Combined with the almost S$594 million in cash and equivalents on the balance sheet at the end of calendar 2005, a payout of more than S$1 billion awaits.
The buyers of Raffles City – CapitaCommercial Trust and CapitaMall Trust – are also part of the CapitaLand stable, but that didn’t mean they got a free kick.
Paying S$2.085 billion – plus another S$81 million in development costs – for an asset that Raffles Holdings said on February 11 this year was on the books at S$1.62 billion is a pretty good deal.
The two REITs, who are yet to get shareholder approval for the deal, will still pick up Raffles City at a yield around 5%.
Another positive about the CapitaLand group is its level of disclosure.
While some Government-Linked Companies meet their statutory requirements but are otherwise at best reticent to disclose useful information, CapitaLand communicates considerably more with its shareholders.
For example, the announcement of the Raffles City sale was made on Sunday afternoon, giving the media enough time to include the story in the Monday morning papers.
Each CapitaLand entity made its own separate announcement, rather than a one-statement-fits all approach.
And Raffles Holdings, after a newspaper story hinting that a Raffles City sale was imminent, disclosed February 11 that it was leaning towards a sale.
That’s certainly an improvement on the common but useless “we don’t comment on market rumour” line.
So, who do YOU think got the best deal?
The REITs? Raffles Holdings? Or CapitaLand.
I look forward to your comments.
Are Singapore companies paying enough dividends?
Are Singapore companies paying enough dividends?
This might have seemed like a silly question a year ago. At that point, the interest rates you could collect on a passbook savings account were still tiny. From a retail shareholder’s perspective it didn’t really matter how much companies paid out, because it was bound to be more than leaving the cash in the bank.
You still have to be a millionaire and leave your hard-earned Singapore Dollars in a fixed deposit for two years to collect a paltry 1.8%.
But there are plenty of special offers around, including one from DBS Bank offering 5.7% on amounts greater than S$200,000 if you buy certain structured products.
Interest rates are rising to a point at which equities investors will find it less attractive and more risky to invest in shares. At least, those investors who want to earn a steady income stream.
At the same time, the companies they invest in are having to pay higher interest rates on the debt they carry, leaving less money to hand back to shareholders.
Taken together, we arrive back at the original question: Are Singapore companies paying enough dividends?
Please start your comments with a ‘yes’ or a ‘no’, and give your reasons.
Other questions you might consider are:
1. if they’re not paying enough, how much should they pay?
2. how much less likely are you to buy shares, given that you might make more money from leaving your cash in the bank?
ArchivesThis might have seemed like a silly question a year ago. At that point, the interest rates you could collect on a passbook savings account were still tiny. From a retail shareholder’s perspective it didn’t really matter how much companies paid out, because it was bound to be more than leaving the cash in the bank.
You still have to be a millionaire and leave your hard-earned Singapore Dollars in a fixed deposit for two years to collect a paltry 1.8%.
But there are plenty of special offers around, including one from DBS Bank offering 5.7% on amounts greater than S$200,000 if you buy certain structured products.
Interest rates are rising to a point at which equities investors will find it less attractive and more risky to invest in shares. At least, those investors who want to earn a steady income stream.
At the same time, the companies they invest in are having to pay higher interest rates on the debt they carry, leaving less money to hand back to shareholders.
Taken together, we arrive back at the original question: Are Singapore companies paying enough dividends?
Please start your comments with a ‘yes’ or a ‘no’, and give your reasons.
Other questions you might consider are:
1. if they’re not paying enough, how much should they pay?
2. how much less likely are you to buy shares, given that you might make more money from leaving your cash in the bank?
January 2006 February 2006 March 2006 April 2006 May 2006 June 2006 July 2006 August 2006 September 2006 October 2006 November 2006 December 2006 January 2007 February 2007 March 2007 April 2007 May 2007 June 2007 July 2007 August 2007 September 2007 October 2007 November 2007 December 2007 January 2008 February 2008 March 2008 April 2008 May 2008 August 2008 September 2008 October 2008 November 2008 January 2009
