SINGAPORE (June 16): Minority shareholders of Perennial Real Estate Holdings should accept the privatisation offer made by the company’s substantial shareholders together with Chinese asset manager HOPU Fund Management Company, according to CGS-CIMB.
See: Perennial's controlling shareholders launch privatisation offer at 95 cents per share
The consortium, which already holds 82.43% of the integrated real estate and healthcare company, is offering 95 cents per share and will not revise the offer.
The shareholders in concert include chairman Kuok Khoon Hong, vice chairman Ron Sim and CEO Pua Seck Guan, the company said on June 12.
“While we see long-term value in its portfolio of development and completed properties, we think investors should accept the offer as the offer price is close to our revalued net asset value-based target price of 99 cents and the gestation period required to complete its development projects,” CGS-CIMB analyst Lock Mun Yee writes in a note dated June 15.
CGS-CIMB notes that Perennial could likely face a more challenging operating environment for its retail and hotel properties due to the novel coronavirus (Covid-19) pandemic.
The brokerage has maintained its “add” rating for the stock with an unchanged target price of 99.4 cents.
As at 11.20 am, Perennial was flat at 94 cents with 403,000 shares changed hands.
