A & M Realty berhad chairman Datuk Ng Thian Hock (right) with his son Steven Ng. - Filepic THE STAR/Zubir Yahya.
PETALING JAYA: The major
shareholder of A&M Realty Bhd is likely to place out up to 6% of the
company to institutional shareholders to loosen the liquidity of the
property developer.
Sources said executive chairman Datuk Ng Thian Hock and his private vehicle Dalta Industries Sdn Bhd will place out 20 million shares and a further 10 million at between RM1.20 and RM1.25 to funds. At RM1.20, the total placement shares will raise between RM24mil and RM36mil.
The remaining shares held by Ng and Dalta cannot be sold for up to six months under a lock-up period. However, Ng and Dalta could seek a waiver from the executing investment bank to sell down at RM1.40 and above to new interested investors.
The source said this would help to stabilise the new share price.
On whether A&M would channel these funds to any of its
projects, the source said that was not the main intention as the
developments were already well-financed.
“It is a net cash company, so this share placement is really to recognise value and get on to the radar of potential institutional and high net worth individual investors going forward.”
The company, which operates in the Klang Valley, is undervalued although its ongoing and future projects boast a total gross development value (GDV) of RM1.9bil, according to a fund manager.
Currently, the company is primarily held by the management and retail investors, which the source explained, was “holding back” the group’s effectiveness to price its shares.
“There is value in A&M which is not reflected in its share price and the company believed it was the right time to communicate that to funds,” the source said.
He added that the share placement would encourage institutional participation which would increase pricing efficiency.
With the placement, the group expects to increase its institutional shareholding by 10 to 20 times.
The source said a group of fund managers visited A&M’s Carey Island golf and resort project last week and “many have come away positive on the company.”
“The funds are showing strong interest and these are insurance funds and unit trusts which tend to invest for the long term,” the source said.
A&M’s near-term growth catalyst is its Amverton Cove Golf and Island Resort development on Carey Island (a total GDV of RM737mil for the first phase).
Going forward, the completion of the SKVE-Carey Island interchange in 2015/2016 will connect the island to Puchong. The enhanced accessibility will have a spillover effect on properties on Carey Island as well as surrounding townships and those along the SKVE.
Its other flagship developments include Amverton Park in Bukit Kemuning and upcoming Amverton Hill at Sungai Buloh. It also has projects in Mont’Kiara and Klang, called Amverton Kiara and Taman Sentosa respectively.
A&M has also embarked on landbanking, having bought 145 acres in Sungai Buloh, 5km off the former Rubber Research Institute land now being developed as Kwasa Damansara township. The group also has another 180 acres in Morib.
RHB Investment Bank is said to be working on the share placement. When enquired, director and head of regional equity capital markets Gan Kim Khoon did not deny this.
The investment bank has been increasingly focused on property companies, among its deals recently were Titijaya Land Bhd’s initial public offering (IPO), SBC Corp Bhd’s rights issue, LBS Bina Group Bhd’s share placement and the upcoming Iskandar Waterfront Holdings Bhd’s IPO.
Sources said executive chairman Datuk Ng Thian Hock and his private vehicle Dalta Industries Sdn Bhd will place out 20 million shares and a further 10 million at between RM1.20 and RM1.25 to funds. At RM1.20, the total placement shares will raise between RM24mil and RM36mil.
The remaining shares held by Ng and Dalta cannot be sold for up to six months under a lock-up period. However, Ng and Dalta could seek a waiver from the executing investment bank to sell down at RM1.40 and above to new interested investors.
The source said this would help to stabilise the new share price.
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“It is a net cash company, so this share placement is really to recognise value and get on to the radar of potential institutional and high net worth individual investors going forward.”
The company, which operates in the Klang Valley, is undervalued although its ongoing and future projects boast a total gross development value (GDV) of RM1.9bil, according to a fund manager.
Currently, the company is primarily held by the management and retail investors, which the source explained, was “holding back” the group’s effectiveness to price its shares.
“There is value in A&M which is not reflected in its share price and the company believed it was the right time to communicate that to funds,” the source said.
He added that the share placement would encourage institutional participation which would increase pricing efficiency.
With the placement, the group expects to increase its institutional shareholding by 10 to 20 times.
The source said a group of fund managers visited A&M’s Carey Island golf and resort project last week and “many have come away positive on the company.”
“The funds are showing strong interest and these are insurance funds and unit trusts which tend to invest for the long term,” the source said.
A&M’s near-term growth catalyst is its Amverton Cove Golf and Island Resort development on Carey Island (a total GDV of RM737mil for the first phase).
Going forward, the completion of the SKVE-Carey Island interchange in 2015/2016 will connect the island to Puchong. The enhanced accessibility will have a spillover effect on properties on Carey Island as well as surrounding townships and those along the SKVE.
Its other flagship developments include Amverton Park in Bukit Kemuning and upcoming Amverton Hill at Sungai Buloh. It also has projects in Mont’Kiara and Klang, called Amverton Kiara and Taman Sentosa respectively.
A&M has also embarked on landbanking, having bought 145 acres in Sungai Buloh, 5km off the former Rubber Research Institute land now being developed as Kwasa Damansara township. The group also has another 180 acres in Morib.
RHB Investment Bank is said to be working on the share placement. When enquired, director and head of regional equity capital markets Gan Kim Khoon did not deny this.
The investment bank has been increasingly focused on property companies, among its deals recently were Titijaya Land Bhd’s initial public offering (IPO), SBC Corp Bhd’s rights issue, LBS Bina Group Bhd’s share placement and the upcoming Iskandar Waterfront Holdings Bhd’s IPO.
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