CWT LIMITED
C14.SI
CWT Limited - HNA General Meeting To Be Convened On 7 Sep 2017
- CWT Limited’s (CWT) offeror, HNA Holding Group (HNA), recently provided an update that a general meeting (GM) will be convened on 7 Sep 17 for the purpose of shareholders of HNA to approve the acquisition of CWT.
- Recall that all anti-trust pre-conditions had been satisfied while the other pre-conditions apart from approval by HNA shareholders is there being no material adverse effect in relation to CWT’s fundamentals (which can be waived by HNA).
- While HNA has said it will finance the acquisition solely through an interest-free unsecured fund to be provided by its associates in the event external financing is not available, we remain cautious given no visibility over the outcome of the China banking regulator’s probe on overseas loans made to HNA. There is also no certainty over whether HNA will truly be able to fund the acquisition without external financing.
- All considered, we believe it makes sense for shareholders to reduce their risk by selling part of their holdings in the market with uneven risk-reward (based on 22 Aug closing price) – potential upside of 3.6% vs. potential downside of 15.1% (our FV on CWT without the deal is S$1.91).
- Our rating of ACCEPT THE OFFER, once the formal VGO is made, remains unchanged.
Eugene Chua
OCBC Investment
|
http://www.ocbcresearch.com/
2017-08-23
OCBC Investment
SGX Stock
Analyst Report
1.910
Same
1.910
