From UOB-KayHian:-
Ownership Under Review
Unisteel’s share price has risen more than 25% since the company announced in April that the ownership of the company was under review.
Unisteel added that discussions with potential buyers were at preliminary stages. Macquarie Capital has been appointed by the company to assist in the evaluation of any proposals that are forthcoming for consideration by Unisteel’s board of directors.
According to Reuters, four potential buyers are bidding for Unisteel. US private equity firms Bain Capital and Kohlberg Kravis Roberts & Co (KKR) are seen as having the strongest interest in the company. Reuters added that Carlyle Group and TPG Capital are also bidding. If a private equity firm succeeded in a majority buyout of Unisteel, company founder and Executive Chairman Bernard Toh Bee Yong is expected to roll over part of his 18% stake into the new firm and play an active role in the future.
Unisteel is one of the leading hard disk drive (HDD) players in Singapore. We believe Unisteel will benefit from the HDD booming market. However, the company is also hit by commodity price hikes and a weakening US$. We will review the target price together with 1Q08 results, which will be released on 13 May 08.