by winston » Wed Jun 03, 2015 11:12 am
not vested
AmResearch maintains Buy on Cocoaland
KUALA LUMPUR: AmResearch has reaffirmed its Buy call on Cocoaland with unchanged fair value of RM2.35 SHARE, pegged to FY15F EARNINGS target PE of 16 times.
Cocoaland announced that it had received an OFFER from HK-based First Pacific Company Limited to acquire its business including all assets and liabilities at RM463.3mil or RM2.70 SHARE, AmResearch said in a note on Wednesday.
"This essentially means that Cocoaland would be an empty shell after the sale of business. The proceeds would either be paid back to shareholders in dividends or as capital repayment.
"At the offer price of RM2.70/share, this value the company at FY15F PE of 18 times based on our forecast," it noted.
AmResearch said the offer price is at a 15% premium of our fair value of RM2.35/share and represents a 32% premium to its last TRADED price of RM2.04/share.
"As such, we recommend investor to accept the offer as the proposed offer price is fair.
Cocoaland has not TRADED at or above the offer price for the past 10 years, the highest being RM2.68/share in July 2010," it said.
This is also higher than the first offer made by Navis Asia VII Management Company Ltd of RM2.20/share on 22 May.
Source: The Star
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