KUALA LUMPUR (Jan 30): RHB Research Institute said Samling Strategic Corporation Sdn Bhd (SSC) intends to pursue a proposed privatisation of Samling Global (SGL), and in turn, SGL will also propose to privatise Lingui and Glenealy.
It said on Monday that SSC has indicated that it expects to propose an offer price of RM1.63 a Lingui share and RM7.50 per Glenealy share.
“At RM1.63 per share, and assuming the offer price of RM7.50/share for Glenealy, this effectively values Lingui’s timber business at a PER of 9-10x based on our CY12 EPS forecast. Valuation seems fair, as this is slightly higher than our current target PER of 8 times for the timber sector and comparable to its closest and more liquid peer, WTK, which is trading at a CY12 PER of 9.5 times.
“The offer price for Glenealy is also fairly valued at a PER of 12.8x consensus CY2012 EPS, similar to our target PER of 13 times for mid-sized PLANTATION [] company.
RHB Research said it believes a formal offer will be put forward once SSC finalises its funding agreement.
The research house revised its call to Trading Buy (from Underperform) for Lingui with a new fair value of RM1.63 per share (from RM1.33), which represents the indicative offer price proposed by SSC.
It said on Monday that SSC has indicated that it expects to propose an offer price of RM1.63 a Lingui share and RM7.50 per Glenealy share.
“At RM1.63 per share, and assuming the offer price of RM7.50/share for Glenealy, this effectively values Lingui’s timber business at a PER of 9-10x based on our CY12 EPS forecast. Valuation seems fair, as this is slightly higher than our current target PER of 8 times for the timber sector and comparable to its closest and more liquid peer, WTK, which is trading at a CY12 PER of 9.5 times.
“The offer price for Glenealy is also fairly valued at a PER of 12.8x consensus CY2012 EPS, similar to our target PER of 13 times for mid-sized PLANTATION [] company.
RHB Research said it believes a formal offer will be put forward once SSC finalises its funding agreement.
The research house revised its call to Trading Buy (from Underperform) for Lingui with a new fair value of RM1.63 per share (from RM1.33), which represents the indicative offer price proposed by SSC.
