atans1

SMRT: Taxpayers get screwed

In Financial competency, Temasek on 25/07/2016 at 6:08 am

Temasek is offering $1.68 per share or $1.18bn to buy out the minority shareholders of SMRT, a 9% premium over the last traded share price of $1.545.

Usually an acquirer pays a premium of up to 30% to gain full control of the target. So the question is why just a 9% premium, shareholders and anti-PAP paper warriors are screaming? “Temasek trying screw minority shareholder isit?” screams Philip Ang financial guru to the cybernuts in TRELand, and Terry’s Online Channel (TOC). Shareholders are saying their shares are worth $2, a 30% premium to $1,545.

Good luck to these greedy people if the takeover is blocked by their greed. In few yrs time, they’ll be complaining of oppression of minorities if SMRT remains listed.

DBS put a value of $1,28 per SMRT share (albeit before the LTA deal but which value it later reiterated after the deal). So at $1.68 (31% premium), it would seem taxpayers are being screwed for the benefit of non-Temasek shareholders. And the greedy sods think they should screw more from us, the taxpayer. Who they think they are? PAP ministers isit?

It would have been better (not necessarily ethically or morally though and it may be illegal) if Temasek had let the market react to the deal before making a bid. As it is one can only look forward to the documents that will be sent to shareholders to see if the price of 1.68 makes sense from taxpayers’ point of view.

At the moment, this doesn’t seem to be the case. The greedy renters are getting 0,40 cents above $1.28, a 31% premium. $280m will be shelled out unnecessarily by Temasek to people who have enjoyed good dividends in times past. Taxpayers’ money is being wasted while the greedy shareholders scream for even more.

And note that the TRE cybernuts want $280m of taxpayers’ money to be wasted on greedy people? In fact they want even more money to be squandered who think they are more entitled than PAP ministers.

 

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  1. You need to understand that SMRT (like SPH) has long ago mutated into a property & rental company. Temasek (and indirectly taxpayers) still get benefits IF the MRT stations rental property assets & profits are also transferred to it. For the past 10 years, the bulk of SMRT profits are from rentals, not train tickets. If SMRT still gets to keep rentals while so-called managing the train services & maintenance, then it will really be MAJOR SCREWING of taxpayers.

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