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Stocks In Focus SG (Asia Fashion Hldgs, Ausgroup, CapitaMalls Asia) – 06/01/14
Asia Fashion Hldgs Agreed To Acquire Construction Materials Company In Hong Kong
Asia Fashion Holdings (AFH) inked an agreement to acquire China Construction Materials (Hong Kong) for a purchase consideration of Rmb100 million.
The target company is an investment holdings company which owns the entire share capital of Xuzhou Zhongsen Tonghao New Board, whose primary business activities involve the manufacture and sale of base material boards, floor and grainy board, decorative boards and aluminum products.
The acquisition will be financed by issuing Rmb50 million worth of new shares in the share capital of AFH based on the volume weighted average price of the company for the latest sixty market days, while the remaining amount of Rmb50 million will be fulfilled by both internal resources as well as the proceeds generated from the placement of 100 million new shares on 15 August 2013.
Significance: The proposed acquisition will enlarge the range of products and services of AFH and enables it to penetrate the growing construction material industry. Further, the proposed acquisition is expected to provide the company with a relatively more stable income stream compared to the capricious nature of the company’s current fabric business.
Ausgroup Proposes Private Placement To Issue 96.1m New Ordinary Shares
Ausgroup entered into an agreement with DBS Group Holdings for the private placement of 96.1 million new shares in the share capital of Ausgroup.
The new placement shares are issued at a price of $0.168 per placement share where the aggregate consideration amounts to approximately $15.2 million (after deducting expenses). As at the date of this announcement, the placement shares represent approximately 19.9 percent of the total number of issued shares of the company.
50 percent of net proceeds generated from the private placement will be used to support collateralisation for the company’s future bonding requirements, while the remaining 50 percent will be designated for general working capital purposes.
Significance:Based on the financial statements of Ausgroup in 1Q14, the company’s net asset value per share (NAVPS) was approximately $0.36. Upon the completion of the proposed placement, the company’s NAVPS would decrease to approximately $0.33.
CapitaMalls Asia And Related Entities To Sell Westgate Tower For $579.4m
CapitaMalls Asia (CMA), in conjunction with CapitaLand and CapitaMall Trust proposed to sell office strata units located on levels 6 to 25 in Westgate Tower for a sale consideration of $579.4 million.
Located in the Jurong East district, the property is the office component of Westgate, an integrated development which also includes a shopping mall. The property, which is currently under construction, comes with a net saleable area of 0.3 million square feet and is expected to be completed in late 2014.
Westgate Tower is currently under development, and the construction of Westgate Tower is expected to be completed by end 2014. As at the date of this announcement and taking into account CMA’s 27.6 percent interest in CapitaMall Trust, CMA’s effective interest in Westgate Development is approximately 58.3 percent.
Significance: When the sale is completed, the office units of Westgate Development will be completely sold as the remaining levels (below six) of the property belongs to the shopping mall.
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