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Total: 375,000 shares.
As an insider, could he know something that we retail investors don't? Probably.
In my last blog post on the subject, I had mentioned that
"the news that Hyflux is issuing preference shares with an annual dividend rate of 6% is somewhat surprising to me. In an environment of low interest rates, isn't paying a 6% interest a bit expensive?
"It would only make sense to do this if borrowing from a financial institution would be costlier and it would only be costlier if the company and/or its business is perceived to be high risk."
Judging by how well the response is to the placement shares, which were 7x oversubscribed, I expect the ATMs to see long queues as people try to get their hands on some of these preference shares.
Application closes on 20 April and the shares will start trading on 26 April.
Good luck to those interested.
Related post:
Hyflux: 6% perpetual Class A preference shares.
Bloggy Award
26 comments:
Hi AK71,
Long time no see. How are you?
Just for laugh:
Have you checked the director's activity lately? I heard rumour he has made a few millions @ our 2 money-printing companies.
Why does he still has to get rid of all his Hyflux shares in a hurry? I rather think he made his millions @ our casino(SGX EX-for some it is our real casino). Ha! Ha!
Cheers.
Hi Temperament,
Good to hear from you again. If he made so much money already, why is he ridding himself of his shares in Hyflux? Hmmm... We can only guess. ;)
Full insider divestment is rarely a good thing....
Hi Hubert,
I am inclined to agree with you....
Personally I wonder if we are reading too much into the insider action.
Whatever happens to the saying 'many reasons for an insider to sell but only one for an insider to buy'. Of cos we often hear this when a positive spin is created for the company in question.
In much the same way, it seems like a lot of people is now trying to attach a negative spin on the action of a director cashing out.
Neither of it makes much sense to me either way. So IMO, an insider cashing out as the company is issuing preference shares are probably independent and unrelated events.
Perhaps SGX should compel directors and substantial shareholders to furbish reasons for their insider trades. Haha but I fear that may be too intrusive.
Hi Paul,
You have made a most objective point. The two events of a director cashing out totally and the timing of the preference shares offer could be completely unrelated, of course. It could be purely coincidental that they took place at about the same time. :)
Maybe he needs the money to send his kids to the UK...
Hi Isaac,
I guess your surname is "Lee"? ;p
Oh no I have shares in Hyflux :X
They are up 5% now. Hope it doesn't crash.
Hi Nick,
I doubt there would be a crash but who are we to second guess Mr. Market's behaviour? ;)
Hi AK,
Hmm, divested all his shares? I do not know what to make of this, and I usually don't interpret it, unless it's the CFO quitting or something like that.
Thanks for highlighting it :)
Hi
How do you know that it is 7 times oversubscribed?
Hi LP,
No need to analyse it too since I am not interested in the preference shares. ;p
Hi Ruttger,
Hyflux Ltd (the “Company”) wishes to announce that under the Reserve Offer and Placement, under which the maximum aggregate liquidation preference of the Class A Cumulative Preference Shares offered amounted to S$200,000,000 (the “Maximum mount”),applications and indications of interest were
received for approximately seven times the Maximum Amount. Due to the overwhelming response, the Company has stopped taking in applications under the Reserve Offer and Placement.
I skip this.
TN.
Hi TN,
I gave the preference shares a miss too but I am sure they won't miss me. ;p
One retiree, who bought into Hyflux at its initial public offering in 2001, told The Business Times that he had put about S$50,000 of his savings into the company. He has been following the news with distress, he said: "I should have disposed of my shares earlier... I don't know if I will get my money back."
Source:
https://www.businesstimes.com.sg/companies-markets/can-hyflux-get-it-right-this-time
Hi AK,
The retiree should just console himself by telling himself that he is on the same boat as billionaire Sam Goi who owns over 29 million ordinary shares of Hyflux. ;P
Hi Kevin,
It is just a drop of water in the ocean for Sam Goi.
I hope it is the case for the retiree. ;p
HI AK,
Citic envirotech looks promising...
Hi Randy,
It is a good industry to be in as clean drinking water will always be an important resource.
I made some good money from Hyflux Water Trust and also Sound Global (aka E-pure) in the past.
Made some pocket money trading shares of Hyflux too.
I am not sure about Citic Envirotech because since China Minzhong, I have not touched any S-chips. ;p
http://singaporeanstocksinvestor.blogspot.com/2014/08/how-to-make-recovering-from-investment.html
Reader says...
Repeat of minibond.
RM sold to aunties.
"Madam Loo Leong Hun was 55 years old when she was given a list of corporate bonds in June 2012 by a DBS relationship manager to invest in as she had savings in her POSB account.
"Hyflux preference shares was on the list, and it was strongly recommended as it was a strategic and national asset. The money was to facilitate expansion and build desalination plants. I thought I had invested in a good company... which was our nation's pride," Madam Loo, now 62, told the High Court yesterday.
Source: The Straits Times, 22 Feb 19.
AK says...
I remember telling some readers that I would not lend money to Hyflux. :p
Simi sai nation's pride?
Eh, if they treat sewage, sai might be an apt description. :p
https://www.straitstimes.com/business/retail-investor-offers-counter-proposal
Zach Zach says...
Just don't buy anything that are recommended by RMs if you are not into investing or don't know anything about investment. Really one. Whose interest do you think is more important to them? 🤣
Lee We says...
That what i like about the market. No bias when it come to wealth, competence and ability. Except for fraud, Dont blame others for your own incompetence. Hail the market, where $ switch hands from the weak to the strong hands (and mind)
Kor Chin Wee says...
Many older investors might not understand what they are buying but are lured by the high yields. Banks would know how to indemnify themselves by paperwork...
the industry is also flawed, as these bankers likely received commissions for selling products they don't even know. 6% well.. some reits also give 5-7%
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