Tuesday, October 11, 2011

CIMB Research: Poser over Liew's S P Setia stake

KUALA LUMPUR: CIMB Equities Research said it was pleasantly surprised by Permodalan Nasional Bhd's (PNB) assurance to S P Setia Bhd chief executive officer Tan Sri Liew Kee Sin that he would continue to lead the company as its CEO.

It said on Tuesday, Oct 11 that since the conditional offer was announced on Sept 28, there were no meetings between PNB and S P Setia until last Friday.

'While the joint statement is certainly good news and both sides are taking a step in the right direction to thrash out the issues, the more important question now is whether Tan Sri Liew will take up the RM3.90 offer. If he sells part or all of his 11.3% stake in SP Setia, investors are likely to follow suit,' it said.

CIMB Research said the upside to S P Setia's share price in the short term is capped by the RM3.90 offer for the parent share and 91 sen offer for the warrants.

There should be greater clarity on the outcome of the conditional offer in the next few weeks as S P Setia's management meets up with PNB to clarify operational issues.

'For exposure to cheaper property stocks that are at steeper discounts to their RNAVs, we continue to recommend Mah Sing in the mid-cap space and UEM Land in the big-cap space,' it said.

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