SINGAPORE (April 4): Singapore Post Limited (SingPost) has announced its intentions to sell its controlling stakes in US e-commerce businesses, Jagged Peak and Trade Global, as part of its strategic review.
In filing on Wednesday night, the postage and e-commerce company says it believes its strengths and strategic competitive advantages lie in the Southeast Asia and Asia Pacific region which provides “attractive growth opportunities”.
Saying it will make further announcements on the exit from the US e-commerce markets, the group adds that its non-US business units will not be affected by the divestment.
“Arising from the strategic review, we will step up our investment to better serve our home market in Singapore, as well as leverage our competitive advantages in Asia-Pacific,” comments group CEO Paul Coutts.
SingPost’s move comes in line with analyst expectations given that the two US subsidiaries have been dragging on the group’s bottomline for the past three years since they were acquired in 2015.
The group is expected to release its full-year earnings results next month.
CGS-CIMB analyst Ngoh Yi Sin had previously lowered her target estimates on SingPost due to expectations of a prolonged turnaround for Jagged Peak and TradeGlobal, despite some earnings improvements in the group’s 3Q financials.
Shares in SingPost closed flat at $1 on Wednesday.