Goodpack

[GreedandFear]

UPDATE 1-Blackstone, Carlyle move in on Singapore's Goodpack -sources
Thu Apr 3, 2014 4:54am EDT
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* Blackstone, Carlyle met Goodpack this week for early talks - sources

* Goodpack stock up 12.3 pct for the year in Singapore (Adds Goodpack share price, other potential suitors)

By Stephen Aldred

HONG KONG, April 3 (Reuters) - Blackstone Group and Carlyle Group are considering a bid for Singapore's Goodpack Ltd, people familiar with the matter told Reuters, eyeing the container maker a few weeks after its takeover talks with Australian pallet maker Brambles ended.

Blackstone and Carlyle had meetings this week with Goodpack, which makes containers used in the rubber, tyre and food industries, people familiar with the matter said. Goodpack's market value is S$1.23 billion ($974.84 million).

The people said that while the meetings showed the firms' interest in the company, there is no guarantee a deal will come as a result. Talks are at an early stage, the people said.

Goodpack said on March 19 that it had been in discussions with unnamed parties which might lead to a buyout of its shares, and had hired Rippledot Capital to advise on the process.

The following day, Brambles said it was engaged in talks with Goodpack but that the discussions had ended.

Goodpack's stock is up 12.31 percent for the year while the benchmark Straits Times Index is up 1.56 percent.

Goodpack specializes in environmentally friendly intermediate bulk containers (IBCs) that could replace wooden boxes and metal drums widely used in bulk cargo today.

Interest in the company comes as private equity M&A had its strongest start to the year since 2011, with first-quarter volume up 48 percent on year to $9.4 billion, Thomson Reuters data shows.

The company previously hired Macquarie as it eyed a possible sale in 2008, and Brambles and packaging company Loscam Ltd were reported as possible suitors at that time. [link.reuters.com/qet28v ]

Goodpack did not respond to requests seeking comment. Blackstone and Carlyle declined to comment. ($1 = 1.2618 Singapore Dollars) (Reporting by Stephen Aldred; Additional reporting by Prakash Chakravarti of IFR/LPC; Editing by Michael Flaherty and Ryan Woo)

[greengiraffe]

Brambles finds Goodpack’s price still a bit rich
DAMON KITNEY THE AUSTRALIAN APRIL 09, 2014 12:00AM


Tom Gorman says Brambles would consider buying Singapore’s Goodpack but only if it is ‘fair value’. Source: News Limited
BRAMBLES chief executive Tom Gorman has an oft-recited mantra that is music to the ears of his investors.

“The thing we are most proud of is that we have been incredibly disciplined on acquisitions. We definitely say no to far more things than we say yes to,’’ he says.

The group recently confirmed its appetite to diversify into new parts of the global supply chain logistics market by revealing it held discussions with Singapore-listed Goodpack about a potential $US1 billion ($1.1bn) takeover.

Brambles said it had ended “active discussions’’ with Goodpack “in the recent past’’, which is believed to mean earlier this year, after the Singapore company revealed it had “been approached by several parties in connection with a possible transaction”.

Goodpack is known as a major intercontinental transporter of rubber products from Asia, but has more recently looked to diversify into the automotive sector.

In his first public comments on the potential deal, Mr Gorman said Goodpack was an “interesting’’ prospect for Brambles.

“Goodpack is a very interesting company because it is in the intermediate bulk container space — that is a business we have.” he said.

“It does manage intercontinental flows. It is in synthetic and natural rubber. Strategically it is very interesting for us.’’

While he reiterated Brambles was not in discussions on the deal, he added: “I think that process still has a way to run. My guess is that there are a few private equity firms looking at it. If something were to happen and they were to come back to us and there was a discussion at a value that made sense for us, yes I think we would consider it.’’

Mr Gorman has been keen to expand into the transcontinental intermediate bulk container market following Brambles’ acquisition of Pallecon for $US177 million more than 18 months ago. “Most of it comes down to what we think is fair value,’’ he said of Goodpack. “We are extremely disciplined when it comes to our shareholder’s resources and how we manage them. And we measure everything against the organic alternative.’’

He added: “We have a number of things we are looking at any given time. But to be blunt, there aren’t many big things out there. Directionally it (Goodpack) is $US1bn. That is a big issue for us.’’

Fund managers say Brambles is a logical owner of the Goodpack business but commended Mr Gorman for standing firm on not paying too much.

[CityFarmer]

The company is likely be buyout. It is a good stock in my monitoring list...

(not vested)

KKR in advanced talks to buy Singapore’s Goodpack

KKR & Co is nearing a deal to buy Singapore-listed Goodpack, the world’s largest maker of intermediate bulk containers which has a market value of $1.36 billion, people familiar with the matter said.

The U.S. private equity firm is working with at least two investment banks on a debt package to buy Goodpack, the people added. KKR has been in discussions to buy Goodpack for nearly a year, but talks are now at an advanced stage, they added.

Goodpack said in March it had been in discussions with unnamed parties which might lead to a buyout of the company, and hired Rippledot Capital to advise on the process.

KKR declined to comment. Goodpack was not available for immediate comment. Sources did not want to be identified as the discussions are confidential.
http://www.theedgesingapore.com/the-dail...dpack.html#

[hongonn]

Is the buyout means this company is delisting again? If so i rather it is not happening.

I found nowadays investment environment in Singapore market is getting tougher by the day, so much tougher compared to 10 yrs ago. Lot of decent counters has delisted one by one. I need to work double hard to look for a decent one. And quite disheartening you won't be able to benefit for too long even you found one.

No wonder the SGX share trading volume has dropped greatly, and it is getting so much less interests from the view of investors.

[GreedandFear]

I just divested at $2.43. Current share price is almost 20x forward PE which seems rich for a company with around a 10-15% p.a. net earnings growth. The company has invested heavily in more containers (over the past couple of years) and there is the upside of more automotive business but 20x still seems high for a financial buyer such as KKR. A trade buyer may be willing to offer a higher premium (because of potential synergies) but a financial buyer does not benefit from those, hence will bid lower. Shares were trading around $1.65 in October, increased to around $2 at the beginning of the year and have now reached 2.45ish after the news of a potential offer. If there is an offer, at what price given that the shares have already run up ? $2.50? $2.60 (25% premium to beginning of the year) ? If the offer doesn't materialise, where will the shares trade ? At the pre-offer rumour stage of January ($2) or October's level of $1.65 ? Difficult to predict whether an offer will materialise, at what level and if it will be successful but if my above parameters are correct then it seems to me that the downside (to the share price) should no offer materialise ($0.50 - $0.85) is significantly larger than any upside at these levels ($0.05 to $0.20). Hence I divested.....

(recently divested)

[CityFarmer]

The company official comment on the buyout.

(not vested)
------
Goodpack Limited (the “Company”) refers to its announcement dated 19 March 2014 and its update announcement dated 17 April 2014 (the “17 April Announcement”).
The Company had informed shareholders in the 17 April Announcement that the Company was in discussions with various parties in connection with a possible transaction, which may or may not lead to an offer for the shares of the Company.

The Company wishes to update shareholders that matters have progressed since the 17 April Announcement and at this time, the Company is continuing discussions with one of those parties. Such discussions are still on-going and there is no certainty whatsoever that these discussions will result in any transaction.

The Company will, in compliance with the applicable rules (including the Corporate Disclosure Policy of the Listing Manual of the Singapore Exchange Securities Trading Limited), make further announcements in the event there are any material developments.

The Company wishes to advise the shareholders of the Company to take note of the above and refrain from taking any action in respect of their shares in the Company which may be prejudicial to their interests.

http://infopub.sgx.com/FileOpen/Goodpack...eID=297787

[greengiraffe]

PUBLISHED MAY 20, 2014
Goodpack hits highs amid reports of KKR talks
BYANDREA SOH
sandrea@sph.com.sg @AndreaSohBT

Reuters and Wall Street Journal (WSJ), quoting unnamed sources, yesterday reported that KKR is nearing a deal to buy the Singapore packaging logistics company for at least US$1 billion - PHOTO: GOODPACK
application/pdf iCONGoing strong
[SINGAPORE] Goodpack's shares continued marching to record highs yesterday, amid news reports that it is in advanced talks with US private equity firm KKR & Co.
Its shares ended two cents higher at S$2.47 yesterday, far above the record of S$2.15 last reached in July 2007. Its shares have risen for four straight days, with increased trading volumes in the last two.
Reuters and Wall Street Journal (WSJ), quoting unnamed sources, yesterday reported that KKR is nearing a deal to buy the Singapore packaging logistics company for at least US$1 billion.
In an update yesterday on its talks with various parties on a possible transaction, Goodpack said that "matters have progressed" since April 17 and that it was now continuing talks with one of the parties.
While Goodpack had reportedly held meetings with two other private equity players Blackstone Group and Carlyle Group early last month, The Business Times understands that they had dropped out of the running.
But the run-up in the share price could imperil the KKR deal as well, given that minority shareholders could ask for a larger premium over an already increased share price.
CapitaLand, which has launched a takeover for CapitaMalls Asia, has had to sweeten the deal by raising the offer price after minority shareholders and market watchers complained that it was too low; in another deal, Ong Beng Seng and Wheelock Properties also raised their offer price for shares in Hotel Properties Ltd after they bought shares in married trades at a higher price.
There is no certainty yet that a deal may happen, according to WSJ.
Goodpack's shares have risen 22 per cent from S$2.03 since the firm first said on March 19 that it has been approached by unnamed parties which could lead to a general offer being made. The company has appointed Rippledot Capital Advisers as its financial adviser, and its founder David Lam - who owns 32 per cent of the firm - is said to be open towards a takeover offer.
KKR set up its South- east Asia office in Singapore in October 2012, and the potential acquisition would mark its first deal here since then.
Goodpack has, over the years, attracted various suitors.
In 2008, it hired Macquarie to look at strategic alternatives - from a sale to a strategic buyer to bringing in new investors. At that time, Australian packing companies Loscam and Brambles were reported to be interested in bidding for the firm.
Brambles, which leases wooden pallets, reusable plastic containers and intermediate bulk containers (IBCs) to the fast-moving consumer goods industry, said on March 20 that while it has engaged in preliminary discussions with Goodpack on several previous occasions, including in the recent past, these did not progress.
Analysts attribute Goodpack's appeal to its strong position in a market niche and its global network which makes for a wide economic moat.
Goodpack rents reusable IBCs to tyre manufacturers, chemical and juice producers such as Michelin, Bridgestone, BASF, Campbell and Heinz, for use in transporting their products, replacing the traditional wooden boxes and metal drums used in these industries.
The firm last Monday posted a 20.2 per cent increase in third-quarter net profit to US$13.1 million. Revenue rose 14.2 per cent to US$51.2 million.

[greengiraffe]

http://infopub.sgx.com/FileOpen/Goodpack...eID=297968

Goodpack confirmed that KKR is the party interested in taking a stake. However, given the obvious indications that they remain in talks and good pack share prices appreciated so much since news first broke that there are negotiations of a change in ownership, I think extreme caution is warranted... if there is indeed a real deal, there won't be any chance for any potential investors to be still trading Goodpack

[hongonn]

I just curious does the offer price negotiation greatly influenced by the company share price? I can imagine how the KKR face turns green if the market chase the stock into $3, $4. Can the company accept any offer much less the stock price? Guess the investors will whack them like crazy.

Hmm put it the other way if the company want to bargain for a higher offer price, maybe they can leak some acquisition news and let the market chase up its own price. Possible?

[greengiraffe]

I just curious does the offer price negotiation greatly influenced by the company share price? I can imagine how the KKR face turns green if the market chase the stock into $3, $4. Can the company accept any offer much less the stock price? Guess the investors will whack them like crazy.

Hmm put it the other way if the company want to bargain for a higher offer price, maybe they can leak some acquisition news and let the market chase up its own price. Possible?

That appears to be a conspiracy theory but unless they are so confident that such leaks will not result in potential buyers walking away.

KKR is a shrewd private equity and they will always walk away should terms don't meet their stringent criteria. In such an event, management and those who are keen to see the deal through will remain status quo and have to keep working.

Brambles have already indicated that while the business is good, the price is a little too steep for the bolt-on to make synergistic sense.

Odd Lots
Vested
GG