Frasers Property (formerly: Frasers Cpt (FCL))

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(11-05-2015, 11:58 AM)Happymeowmeow Wrote: FCL said it will use the proceeds of the proposed transaction to reduce its borrowings and gearing. Based on the proforma financial effects of the proposed sale and leaseback arrangement, assuming this has taken place on Sept 30, 2014, its gearing is estimated to decrease from 95 per cent to 91 per cent. - See more at: http://www.straitstimes.com/news/busines...3OMQ6.dpuf

gearing is still way too high

hope they can bring it down to 50% by year end
Hi happymeowmeow,

Fcl had stated that this is their comfortable gearing range and strategy in their annual report and agm. If their gearing comes down, it will likely be in anticipation for another major acquisition like Australand.

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(11-05-2015, 12:07 PM)thor666 Wrote:
(11-05-2015, 11:58 AM)Happymeowmeow Wrote: FCL said it will use the proceeds of the proposed transaction to reduce its borrowings and gearing. Based on the proforma financial effects of the proposed sale and leaseback arrangement, assuming this has taken place on Sept 30, 2014, its gearing is estimated to decrease from 95 per cent to 91 per cent. - See more at: http://www.straitstimes.com/news/busines...3OMQ6.dpuf

gearing is still way too high

hope they can bring it down to 50% by year end
Hi happymeowmeow,

Fcl had stated that this is their comfortable gearing range and strategy in their annual report and agm. If their gearing comes down, it will likely be in anticipation for another major acquisition like Australand.

Sent from my D5503 using Tapatalk

thanks for the info.. like that I will sell it soon
I not so comfortable with such a high gearing level, especially when interest rates will be going up
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Australand to recycle assets
Su-Lin Tan
433 words
12 May 2015
The Australian Financial Review
AFNR
English
Copyright 2015. Fairfax Media Management Pty Limited.
Singapore-listed Frasers Centrepoint Limited plans to recycle the assets in its latest acquisition, Australian diversified property group, Australand's assets, into its real estate investment vehicle platforms.

Frasers said in a quarterly update on Monday it would also increase Australand's land bank through the acquisition of more development sites in Sydney, Melbourne and Brisbane.

"Our key goals for Australia is to maintain momentum in delivering development pipeline and focus on strategic review of Australia business," Frasers Centrepoint's group chief executive, Lim Ee Seng, said.

Frasers' strategic review for its assets, including those in Australand, was to optimise asset productivity through its REITs to "unlock and release capital from assets". The move would also strengthen its balance sheet through a decrease in gearing.

The group has already begun this strategy with its Singapore-listed Frasers Commercial Trust recently acquiring the 25-storey 31,920-sq m freehold office property at 357 Collins Street from Australand Property Holdings (Collins St No.1), a wholly-owned trust of Frasers Australand, last month.

The sale was still conditional on an approval from the Foreign Investment Review Board.

Mr Lim said the group would continue to expand residential development in Australia, particularly Sydney and Melbourne which had strong housing markets. "There will be strong activity in these areas in the next 12 to 18 months," Mr Lim said.

He said the focus for Australand would be on residential projects as yields on office and industrial assets tighten in Australia.

"We will be looking for more complex assets to unlock in Australia," Australand's chief executive, Bob Johnston said. "The focus will be on key cities, Sydney Melbourne and Brisbane and less in the Perth market."

He said Australand has tenders with the government for both residential and industrial developments.

The group also reported on Monday Australand was on track with its targets, having completed over 750 apartments in the first half of the 2014/15 year. It also released over 1200 land lots and apartments for sale in the same time, mainly in NSW and Victoria.

The Sydney developer has 1650 units planned for release in the next half of the year. Australand has unrecognised residential revenue of $S1.8 billion ($1.7 billion) at March 31.

It acquired land in Coorparoo, Queensland, with a potential for 366 units worth $S263 million ($250 million)

Australand also delivered five commercial and industrial facilities in the first half of the year worth $S121 million ($115 million) and has another 96,000 square metres of commercial & industrial development potential.


Fairfax Media Management Pty Limited

Document AFNR000020150511eb5c00013
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http://infopub.sgx.com/Apps?A=COW_CorpAn...2May15.pdf

Frasers Centrepoint Limited (the “Guarantor”) wishes to announce an offer by its wholly-owned
subsidiary, FCL Treasury Pte. Ltd. (the “Issuer”), of up to S$200,000,000 in aggregate principal
amount of 7-year 3.65 per cent. bonds due 2022 (the “Bonds”) (the “Offer”), unconditionally and
irrevocably guaranteed (the “Guarantee”) by the Guarantor, comprising:
(i) an offer of up to S$150,000,000 in aggregate principal amount of Bonds at the issue price of
100 per cent. to the public in Singapore through electronic applications (the “Public Offer”);
and
(ii) an offer of up to S$50,000,000 in aggregate principal amount of Bonds at the issue price of
100 per cent. to institutional and other investors (the “Placement”),
(1) the Issuer and the Guarantor reserve the right to cancel the offer in the event that less than
S$75,000,000 applications in aggregate are received under the Offer;
(2) the Issuer and the Guarantor may, at their discretion and in consultation with the Sole Lead
Manager and Bookrunner (as defined herein), re-allocate the aggregate principal amount of
Bonds offered between the Public Offer and the Placement; and
(3) in the event of oversubscription in the Public Offer and/or the Placement, the Issuer and the
Guarantor may, at their discretion and in consultation with the Sole Lead Manager and
Bookrunner, (i) increase the issue size of the Bonds under the Public Offer and/or the
Placement and (ii) determine the final allocation of such oversubscription between the Public
Offer and the Placement, such that the maximum issue size under the Public Offer and the
Placement shall not exceed S$500,000,000 in aggregate principal amount of the Bonds.
The issue price of the Bonds is S$1 per S$1 in principal amount of the Bonds (being 100 per cent.
of the principal amount of the Bonds).
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Good deal for FCL.... window of opportunity for low cost of funding is still open.
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Thks GG san. This company is not just fast at divesting assets, but also very fast at capital management, getting a good deal for the company for a 7 year bond.
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Towkay Charoen is no ordinary businessman. So far he has demonstrated his ability to take full advantage of OPM (Other People's $) to steer business opportunities to his advantage.

I supposed his full suite of generals have provided him with diverse views of the various aspects to manage businesses globally. Having a son-in-law who is a former investment banker (now looking at the business from a owners' perspective) does provide an additional advantage over executives with little stake in a company.

Beyond the extraction and enhancement of value hidden within an established full suite property platform, it remains interesting how Towkay will eventually enhance the trading liqudity of FCL. So far I am correct that FCL was the main focus after value has been fully extracted from former parent F&N.

Having said all these, I think div yield of 4.67% on historical DPS of 8.6 cents remains more attractive than the pending 7 year bond yield. The choice is yours...

Vested
GG

(12-05-2015, 09:59 AM)Contrarian Wrote: Thks GG san. This company is not just fast at divesting assets, but also very fast at capital management, getting a good deal for the company for a 7 year bond.
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> it remains interesting how Towkay will eventually enhance the trading liqudity of FCL.

Guru GG, he answered the question on liquidity at the recent AGM. The person who raised the question also asked about composition of the board.

He is known to keep expanding. I don't know if he know when to play defence :-)
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(12-05-2015, 05:50 PM)Contrarian Wrote: > it remains interesting how Towkay will eventually enhance the trading liqudity of FCL.

Guru GG, he answered the question on liquidity at the recent AGM. The person who raised the question also asked about composition of the board.

He is known to keep expanding. I don't know if he know when to play defence :-)

Maybe he doesn't need to defend. Perhaps he has solid backers that are unknown to us...
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A walk back into memory lane with Towkay Charoen:

http://www.bbc.com/news/business-21289363

Thai whiskey tycoon Charoen takes over Fraser and Neave
By Jonathan Head
BBC News, Bangkok
3 February 2013
From the section Business
Thai billionaire Chareon Sirivadhanabakdi
Thai billionaire Chareon Sirivadhanabhakdi has gained control of Singapore's F&N
What are the secrets of business success in Thailand?
You could try asking Charoen Sirivadhanabhakdi, the country's third richest entrepreneur, with a net worth of at least $6bn (£3.8bn; 4.4bn euros).
Mr Charoen has just expanded his drinks and property empire after an epic battle to control the venerable Singapore conglomerate Fraser and Neave (F&N).
But this intensely private man rarely makes public comments.
Like almost all of Thailand's tycoons, Mr Charoen is ethnic Chinese. He is the sixth of 11 children of a poor street vendor who migrated to Bangkok from southern China. To this day Mr Charoen speaks Teochew, his native Chinese dialect, as well as Thai.
He left school early, at the age of nine, to work. Eventually he started supplying to distilleries producing the local Thai whiskey, which were a state-run monopoly at the time. Through the contacts he made, he acquired a licence to produce his own alcoholic drinks.
Spirit of success
By the mid-1980s he was operating all the large state-owned distilleries, and controlled the entire market for inexpensive local spirits.
In 1991 Mr Charoen teamed up with the Danish brewer Carlsberg to tap into Thailand's growing beer market, at the time dominated by the 60-year-old Boon Rawd company which made Singha beer.
The idea was that Mr Charoen's brewery would make Carlsberg, and use the sales and marketing networks for his Thai whiskey to sell it. But three years later, based on what he had learned from Carlsberg, he began making his own beer, branded Chang (elephant in Thai).
Chang beer
Mr Chareon's Chang beer dominated the local market within five years of its launch
He made it more potent than Singha, and cheaper, and marketed it very aggressively.
Within five years, Chang had captured 60% of the local market share.
Completely eclipsed, in 2003 Carlsberg pulled out of the joint venture. Mr. Charoen then successfully sued the Danish company, winning $120m.
Crisis and opportunities
The late 1990s threw up two formidable challenges; the 1997 Asian financial crisis, which saw two financial companies part-owned by Mr Charoen collapse, and the government's decision to privatise the state-owned distilleries which were providing him with most of his profits.
But with a cash-rich and relatively recession-proof liquor business he was far better off than many other Thai entrepreneurs. He exploited the crisis and cemented his position as one of Thailand's most powerful figures, buying up land and property at distressed prices, and helping out troubled, but politically-connected businesses that could one day return him favours.
And when the distilleries were put up for auction in 1999, his companies managed to buy all 12 of them. How did he accomplish that? By using his vast stocks of alcohol as collateral, Mr Chareon borrowed $500m. He then ramped up production. The message was clear; he had enough cash to outbid any potential rival (he ended up paying $385m), and he also had enough alcohol in stock to flood the market with cheap booze for months.
He had to "manage competition over the bidding so the auction did not raise the price too high", writes Thai historian Nualnoi Treerat. "This required skills to share the rents with rivals who were too powerful to ignore, the ability to intimidate rivals who were not too powerful, and the judgement to distinguish between the two."
Over the past decade his empire has grown, as he has acquired huge property holdings that include vast tracts of agricultural land, in Thailand and in neighbouring countries like Cambodia, as well as hotels and entire blocks of apartments.
Everton footballers
ThaiBev's sponsorship deal with English Premier League team Everton hit a record $18m
He also bought a controlling stake in an established Thai food and bottling company, Berli Jucker, which he is now using to expand into the convenience store market.
He was briefly in the spotlight when he tried to buy Liverpool football club in 2004, and, when that failed, he inked a sponsorship deal with Merseyside rivals Everton.
But mostly he kept a low profile.
That changed in 2005, when he brought all his various alcoholic drinks businesses under a single name, ThaiBev, and announced he would float it on the Bangkok Stock Exchange. Suddenly Mr Charoen got a lot more publicity than he had bargained for.
Thais have an ambivalent attitude to alcohol. Drinking is not prohibited under Buddhism, but it is frowned upon by many Thais as not socially respectable, and a threat to family life.
One ascetic Buddhist sect organised protests against the ThaiBev stock listing, some outside Mr Charoen's home in Bangkok, which escalated to the point where he was forced to shift the listing to Singapore. A second attempt to list in Bangkok in 2008 also failed.
Family business
Mr Charoen runs ThaiBev and its parent company TCC in much the same way as Thailand's other Chinese tycoons - as a strictly family business. And it is probably no coincidence that he has begun expanding overseas and becoming more 'public' just as his five children have come of age and can start running the different parts of his empire.
All five have benefited from top educations overseas, but have come back to live with their father and mother in a 10-storey family compound in central Bangkok.
His son Thapana is now the chief executive officer at ThaiBev and his daughter Wallapa is executive director of TCC Land, the property arm. She admits he acquired so much land and property over the years he does not actually know what he owns.
But Charoen Sirivadhanabhakdi was certainly involved in the key decisions during the six-month battle for Fraser and Neave. It was a contest that required all the skills learned over 50 years in Thailand's treacherous business environment, of patience and ruthless determination to win the prize.
Now he has it, he has become a significant regional player, one of a growing club of Thai entrepreneurs moving from domestic success onto a tougher and more sophisticated global stage.
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