Sino Grandness

[leeeta]

Hi Leeta,
The old adage saying 'What is dumb at one price, is clever at the other'.

My point is, the Thais are getting a real sweet deal (paying half for a full P/L recognition privilege). Sweet deals are hard to extract from good companies. But sometimes good companies can go distressed and are 'forced' to do sweet deals. Examples would be WB extracting excellent deals with juicy fixed coupons from Harvey Davidson/Goldman Sachs during GFC08 period. So is SFI a good company or a distressed company?

While the Thais and OPMIs of SFI both have $ vested and will share in losses, i see that there is still great asymmetry between both. As a listed and investment holding company, the Thais have different ways to extract value from their stake in SFI - For example for 1H15, SFI accounts for > half of its final accounting profit, since its other energy/shipping businesses are suffering losses. Propping up its accounts in turn can help to support its share price, allows it to keep to its covenants (if any), maintain its ratings and issue new debt. I would argue that it is more beneficial for them to keep the show running on for now, to continue to milk its intangible benefits from SFI. OTOH, OPMIs of SFI can only wait for capital gains from selling their stock or the proposed 2016 dividend.

It is interesting to see the view that TTA now is being painted as a party that is trying to benefit from alleged inflated profit that Sino Grandness is reporting.

The consequences to TTA will be severe, if Sino is a fake. Not only it has to write off the $30m in buying up Sino shares. It also have to reverse the share of Sino profit that it has recognised.

Prayudh's family has 20% stake in TTA. The other shareholders includes provident funds, Insurance companies etc.
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