12/18/2012

Temasek could end up as the biggest shareholder of Olam


Temasek owns 16.3% of Olam while Kewalram owns 20%. How is Temasek represented in the Olam Board and how much influence does it have with such a big share of the company relative to Kewalram? And Temasek could easily be the biggest shareholder of Olam after the bond issue. Kewalram, the mother company of Olam has said that it would take up its full entitlement of the bond/warrant issues. Temasek would take up its entitlement too, but also mop up everything that is not taken up by the market.

Kewalram would have to put up US$150m for the stake while Temasek’s stake is $120m. The whole issue is reportedly worth $1.25b. Theoretically it is possible for the balance, other than Kewalram’s stake, to fall onto Temasek’s lap or $1b worth of bond and warrants. That would be as good as Temasek owning anything more than Kewalram’s 20% stake. Shouldn’t this be a great opportunity for a cheap takeover of Olam and later sell it for a big profit? If it chooses to keep the company as a going concern, it can than appoint some Sinkies to manage the company as a private company. No need to privatise to be efficient and profitable.

10 comments:

patriot said...

A blessing and windfall for Temasek You mean?

Chua Chin Leng aka redbean said...

Can be windfall can be waterfall.

patriot said...

Haha.....

Water(水为财)
So waterfall or windfall
means win all.

patriot

agongkia said...

Dun be daft sinkie trying to act smart.
Bigger shareholder can also mean bigger loser.Suffer and incur more losses compare to the smaller shareholder.

Anonymous said...

Red bean, I don't think there are any experienced sinkies that can take the olam job cause if there are any, they would not have to employ all highly skilled expat Indians as expats are very expensive

jjgg said...

RB...such a puzzling transaction..Temasicko underwriting the rights issue..bankers not underwriting..majority shareholder went hiding until everythings' announced...the pace which Temasicko did their due diligence would suggest that the ground troops were already in Tanzania and Nigeria counting cattle heads and cashew nuts way before any announcements..hehehe..btw..not many profitable companies in Singapore will report a healthy profit and yet have a cash flow deficit...that premise is largely reserved for the S chips and we know where those are heading..

Chua Chin Leng aka redbean said...

Let's hope Temasek has done its homework and not like those bank jobs that end up with a big hole.

I think Darkness could be one such talent for this of biz.

Veritas said...

I thought PAP subscribe to Capitalism. We must let companies bankrupt so clear off dead woods?

Then we should let Olam bankrupt.

And besides, I do not think PAP really knows about investment. Central bank should hoard our savings in Gold as all central bank did for hundreds or even thousands of years.

What worst thing is serial loser Ho Ching was appointed CEO of Temasek. Our CPF is gone.

Anonymous said...

It's a lot of money to pay for a trading company.
The value of a trading company depends on its traders.
You think traders cannot jump ship and set up a new trading company where they can own 100% of the shares?

Matilah_Singapura said...

Why not?They have lots of cash, and are highly motivated to engage in "good deals". (hahaha)