ST Engineering

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Jun 1, 2011
ST Engineering enters satellite joint venture

ST ENGINEERING is going off the planet.

The engineering company has entered into a joint venture with Nanyang Technological University (NTU) and DSO National Laboratories to design, develop and produce advanced earth observation satellites.

These satellites will take images of the Earth from outer space, monitoring phenomena such as weather patterns.

The joint venture is called ST Electronics (Satellite Systems) and ST Engineering will own 51 per cent of the company, while DSO will own 33 per cent and NTU 16 per cent, ST Engineering said yesterday.

The stake of Singapore-listed ST Engineering in the joint-venture company will be held by ST Electronics, its electronics arm.

'ST Electronics views the earth observation satellite segment as a new and complementary addition to its existing satellite communications and sensor systems business,' said ST Engineering in a statement yesterday. 'This new JV company will enable ST Electronics to offer a more comprehensive suite of satellite and earth observation solutions and services to its customers.'

Calling it a major milestone in the country's satellite industry, ST Engineering said the the joint venture will utilise both DSO's and NTU's expertise in research and engineering to research, develop and manufacture products and services for advanced earth observation satellites. ST Electronics will head marketing, business development and operations for the new business.

'Together with the system development expertise and global marketing reach of ST Electronics, the JV will develop satellite technologies in Singapore and take these into the global market,' ST Engineering added.

The setting up of the new subsidiary is not expected to have any material impact on the consolidated net tangible assets per share and earnings per share of ST Engineering for the current financial year, it said.

ST Engineering's share price fell by three cents yesterday to $2.97.


My Value Investing Blog:
Halted @ 4:06:54 PM

STX PO Halted @ 4:03:20 PM

NeraTel Halted @ 3:47:13 PM

I wonder if it's coincidental or some major joint announcement?? Let's hope it's something good! Huh

<Vested in STEng>
Luck & Fortune Favours those who are Prepared & Decisive when Opportunity Knocks
------------ 知己知彼 ,百战不殆 ;不知彼 ,不知己 ,每战必殆 ------------

Nera has announced on 3rd Feb of a potential buyer. Could it be ST Eng?

The toughest thing to do is have to wait for the opportunity patiently.

Based on the Section 11a
Current Financial Period Reported On

"Please refer to the scheme of arrangement which is to be proposed by the Company to the
Shareholders under Section 210 of the Companies Act, Chapter 50 of Singapore (“Scheme”) as
set out in the joint announcement made by the Company and Singapore Technologies Electronics
Limited dated 10 February 2012."

It seems like ST Electronic is buying over Nera Tel..Wait for more news coming....
NeraTel: Last done before halting = $0.50

Offer from ST ENg: $0.45 ($0.39 cash + $0.06 dividend)

Why would any shareholder in his right mind approve the deal??

The interesting thing about the announcement is that it contains a lot of miniority-unfriendly terms like incentive payment to the Nera CEO and president (2 million!), retention bonus for key directors (1.5 million) and something called a 'switch option'

Neratel has been one of my best dividend generating companies since I bought in 2006 and I will resist as far as I can; but I fear the inevitable. So maybe I should just dump in the open market for anything above the offer price; or be brave and just hold on till the end.

*sigh* Another one bite the dust *sad*
Look like ST Engr underpaid the current share price. Match my impression, ST Engr tends to be very stingy, or should i say, very cost conscious. Anyway run a glance on NeraTel finance, overall i think is a good buy.

Share Price Scheme Consideration per Share
Premium / Discount to Share Price
(S$) (S$) (S$) (%)
Closing price on 9 February 2012
0.475 0.450 (0.025) (5.26)
Extracts fm Pg 9 of SGX Annc,

Closing price on 9 February 2012

1 calendar month VWAP up to 9 February 2012

3 calendar months VWAP up to 9 February 2012

6 calendar months VWAP up to 9 February 2012

9 calendar months VWAP up to 9 February 2012

Extracts fm Pg 4,

The Company has been informed by Eltek that Mr. Ang Seong Kang Samuel (“Mr. Ang”), the Chief Executive Officer and President of the Company, had at the request of Eltek, on 5 August 2011 entered into an incentive agreement with Eltek (“Incentive Agreement”), pursuant to which Mr. Ang had undertaken, inter alia,

(a) subject to the consent, and directions, of the board of directors of the Company and any legal, equitable, fiduciary or contractual obligations, to consult in good faith with Eltek with a view to providing and establishing appropriate procedures for the purpose of facilitating the possible sale of Eltek’s Shares; and

So, why was NeraTel share price on an uptrend from as far back as 9mths ago?? Don't forget, STI was on the decline during that period?? Tongue

Luck & Fortune Favours those who are Prepared & Decisive when Opportunity Knocks
------------ 知己知彼 ,百战不殆 ;不知彼 ,不知己 ,每战必殆 ------------
STEng FY11 results will be out today. Just for fun, I'm guessing the 2H11 Dividend to be slightly higher than 11.55ct (2H10), using the EPS of 1st 3Q and last 2 years' payout ratio of ~90%. My 'crystal ball' predicts a range of 11.73ct to 12.28ct. Tongue

Luck & Fortune Favours those who are Prepared & Decisive when Opportunity Knocks
------------ 知己知彼 ,百战不殆 ;不知彼 ,不知己 ,每战必殆 ------------
u got to give it to STEng, they have the $, strategic foresight, and the inter-personel network to crave out such a good deal for themselves...

1) Try NOT to LOSE money!
2) Do NOT SELL in BEAR, BUY-BUY-BUY! invest in managements/companies that does the same!
3) CASH in hand is KING in BEAR! 
Some of their govt projects does not make money but they don't have a choice.They are the only ava 'contractor'.
They hire too many 'oil tanker'...ex senior officer.High pay but don know what they do.. only for the connection but i believe without them ST will still gets e project.
The exec employee stock option.Every dollars u contribute coy give 50ct. cap at 10% of basic pay.

The thing about karma, It always comes around and bite you when you least expected.

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