Red Sena : Safe Haven in times of turmoil?

Red Sena, an F&B SPAC listed on Bursa Malaysia (Stock Code: 5270) is currently sitting on 371m cash trust proceeds. Similar to the Reach Energy, shareholders who vote against the acquisition of a business concern identified by management are entitled to their share of cash trust proceeds.

Cash trust currently owing to public shareholders amounts to RM0.464 per share, a tiny 2% discount against the current ask price of RM0.455.

Shareholders can only expect FD like returns ranging from 3-4% per annum net that comes with potential for solid acquisition targets. Downside for shareholders is protected with the right to reject any deal that is deemed expensive or businesses that has murky future outlook.

Investors may diversify into this unique situation-based stock. With stocks riding high every day and solid undervalued gems ever harder to be found, investors may park their cash in this stock in the event of a widening discount against cash trust per share.

Note: This is not an investment advice. Buy and sell any securities at your own risk.

Disclosure: None.

Stock “Highlights” – Year End Review

All Investors dabbling in stock market are in it to grow their bank accounts so that they can buy more stuff in the future. During the short 1 year existence of this blog, there have been a couple of listed stock market deals highlighted and it is good practice to present the scorecard for the specific stocks highlighted as the year 2016 comes to a close with several assumptions as per the scorecard below:

Should you have invested your hard earned cash in equal proportions in every single counters above, you would have been 10.47% “richer” at the end of the holding period, assuming you dispose all investments at the stated “best case scenario” and 16 December 2016 “report card date”.

Is 10.47% good enough returns to justify the sweat and tears of digging through exchange filings and bearing the potential pain of share price losses? Is spending hours analyzing individual counters worth the 10.47% as compared to putting all your eggs in Fixed Deposit with a Malaysian Bank which will yield you 4% tops? Probably or maybe not.

Hope 2017 will present whole new sets of juicy speculative deals which I may pen my simple thoughts on, and bear some financial fruits for my bank account.

Note: This is not an investment advice. Buy and sell any securities at your own risk.

Disclosure: None.

Reach Energy: Potential Risk Arbitrage? (2)

Recall in an earlier posting that highlighted the risk arbitrage deal offered by Reach Energy listed company shares. Fast forward to 15 November 2016, it had successfully obtained sufficient shareholder approvals to acquire an oil and gas outfit.

The option to vote officially expires on 28^th October 2016 where if you are a shareholder up till the end of business day, you have the right to attend the EGM and cast your vote on the acquisition. Shareholders who voted against the acquisition would have gotten back approximately RM0.76 per share as per the following Bursa stock exchange announcement made by the company via a share purchase mechanism:

http://www.bursamalaysia.com/market/listed-companies/company-announcements/5271517

Shareholders focusing solely on extracting the risk arbitrage spread offered by Reach would have earned a decent premium. However, the share repurchase price paid by the company is subject to the qualifying acquisition going through. Christmas indeed came early should you have bought into Reach below RM0.70 per share price levels.

This post will end the story for Reach risk arbitrage chapter.

Note: This is not an investment advice. Buy and sell any securities at your own risk.

Disclosure: None.

Hwang Capital: Potential bumper dividend round 2? (3)

Recall in an earlier posting that highlighted the takeover offer by Hwang major shareholders. It was speculated that another major stakeholder DBS would accept the offer but the parties agreed for acceptance did not work out as expected as per news article summarized below:

http://www.thestar.com.my/business/business-news/2016/07/02/takeover-offer-for-hwang-capital-turns-unconditional-and-acceptances-period-extended/

http://www.thestar.com.my/business/business-news/2016/10/10/hwang-capitals-conundrum/

Since the company’s share has been suspended there will be no room for entry or further opportunities and this post caps off the Hwang privatization journey.

Note: This is not an investment advice. Buy and sell any securities at your own risk.

Disclosure: None.