SingTel Q2 profit below forecast; flags challenges in Australia

SINGAPORE - Singapore Telecommunications Ltd reported a 1.6 per cent fall in second-quarter net profit on Wednesday, dragged down by higher costs and weaker regional currencies, and flagged a drop in group revenue this fiscal year due to its Australian unit Optus.

SingTel, Southeast Asia's largest telecommunications firm, said it now expects operating revenue in Australia to fall by mid single-digit levels in the financial year ending March 2013, due to price competition and reduced mobile termination rates. Previously, revenue in Australia was expected to grow by low single-digit levels.

With the revised revenue outlook for Australia, SingTel said its group revenue is seen falling by low single-digit levels. But it said group earnings before interest, taxes, depreciation and amortisation (EBITDA) are expected to be stable.

SingTel had net profit of S$868 million (US$710 million) for the three months ended in September, down from S$882 million a year earlier.

Excluding exceptional items, underlying net profit was S$886 million. That was below the S$896 million average forecast based on a Reuters poll of six analysts.

SingTel maintained an interim dividend of 6.8 Singapore cents per share.

Pretax earnings from SingTel's regional mobile associates grew 17 per cent to S$549 million, with strong operating performance from Indonesia's Telkomsel and Thailand's Advanced Info Service PCL helping to offset weaker results from India's Bharti Airtel Ltd.

Bharti Airtel reported its 11th consecutive quarter of profit declines last week, with margins under pressure from intense competition.

SingTel shares have risen about 3 per cent this year, underperforming a 14 per cent gain in the broader Straits Times Index.

Of 24 analysts tracking SingTel, 14 have "hold" ratings, six have "buy" or "strong buy" and four have "strong sell". - REUTERS

http://www.reuters.com/article/2012/11/13/singtel-results-idUSL3E8MD61A20121113

Heineken takeover of Tiger Beer maker approved

SINGAPORE: Shareholders in the parent company of the Singapore-based brewer that makes Tiger Beer on Friday approved the firm's takeover by Dutch giant Heineken.

The nearly unanimous vote at an extraordinary general meeting of Fraser and Neave (F&N), which held 40 per cent of Asia-Pacific Breweries (APB), clears the way for Heineken to take full control of APB.

Heineken, which is seeking to expand its Asian sales as demand falls in western markets, already held 42 per cent of APB when it made a bid.

"I declare the resolution carried," F&N chairman Lee Hsien Yang said after 98.73 per cent of shareholders voted for the deal.

A Thai faction in F&N led by beverage billionaire Charoen Sirivadhanabhakdi had earlier emerged as a potential rival to Heineken but later gave its approval to the sale of APB, which also makes Indonesia's Bintang Beer.

Heineken offered F&N S$5.6 billion (US$4.6 billion) for its stake in the brewer.

Before Friday's meeting in Singapore, Heineken bought an additional 8.6 per cent in APB held by Thailand's Kindest Place Groups, also linked to Charoen.

http://www.channelnewsasia.com/stories/afp_asiapacific_business/view/1228483/1/.html

ThaiBev, TCC Assets to vote against F&N's proposed capital reduction

SINGAPORE: Fraser and Neave's largest shareholders - Thai Beverage and TCC Assets - said they will vote against the conglomerate's proposed capital reduction.

In a joint statement issued on Wednesday night, ThaiBev and TCC Assets - controlled by Thai billionaire Charoen Sirivadhanabhakdi - did not explain why they will vote against the proposed capital reduction. 

Mr Charoen, through TCC Assets, had launched a US$7.2 billion (S$8.8 billion) offer this month to buy out other shareholders of F&N at S$8.88 a share. 

Earlier, F&N said it plans to cancel one for every three shares held by all shareholders and pay out S$8.50 for each cancelled share. 

That is a total of S$4 billion to be paid out by F&N to its shareholders. 

The vote on F&N's proposed capital reduction will be cast on Friday, when the conglomerate's shareholders will also vote on the proposed sale of the company's 40 per cent stake in Asia Pacific Breweries to Heineken. 

ThaiBev and TCC said last week that they would vote in favour of the APB sale to Heineken.

http://www.channelnewsasia.com/stories/singaporebusinessnews/view/1228160/1/.html

Singapore's Temasek to sell 400 mln shares in SingTel

(Reuters) - Singapore state investor Temasek has agreed to sell 400 million shares in Singapore Telecommunications Ltd, according to a stock exchange filing on Wednesday.

"We continue to be a significant shareholder in SingTel, which remains the largest company in our portfolio," Temasek said in a statement, but did not give further details.

According to a term sheet seen by IFR late on Tuesday, the sale will comprise a base size of 400 million SingTel shares at S$3.20 and S$3.25, which works out to about S$1.3 billion ($1.06 billion). It includes an option to sell another 100 million shares that if exercised will raise the deal size to $1.34 billion.

Assuming all 500 million SingTel shares are sold, Temasek's stake in Southeast Asia's largest telco will fall to about 51.3 percent from 54.4 percent. ($1 = 1.2244 Singapore dollars) (Reporting by Charmian Kok; Editing by John Mair)

http://www.reuters.com/article/2012/09/26/singtel-temasek-sale-idUSL4E8KQ00N20120926

Heineken Says Thai Billionaire Supports Its APB Offer

Heineken NV (HEIA) cleared the biggest hurdle in its fight to take control of Asia Pacific Breweries Ltd. (APB) as billionaire stakeholder Charoen Sirivadhanabhakdi’s Thai Beverage PcL (THBEV) pledged its support.

Thai Bev and Charoen’s TCC Assets Ltd. will back Heineken’s S$5.6 billion ($4.6 billion) bid forFraser & Neave Ltd. (FNN)’s 40 percent stake in the beermaker at a shareholder meeting next week after the Dutch brewer agreed not to make a competing offer for F&N, the Amsterdam-based brewer said yesterday. Heineken had previously operated APB via a joint venture with F&N.

“For Heineken, this significantly improves the level of certainty that our offer will be approved,” John Clarke, a spokesman for Heineken, said by telephone.

APB would be the Dutch brewer’s largest acquisition since its 2010 purchase of Fomento Economico Mexicano S.A.B’s beermaker as it seeks to expand in faster-growing emerging markets, according to data compiled by Bloomberg. Singapore- based APB has rights to brew Bintang in Indonesia, Anchor in China, Southeast Asia and Sri Lanka, and Heineken from China to New Zealand.

TCC, controlled by 68-year-old Charoen, offered S$9 billion on Sept. 13 to buy the 70 percent of F&N he didn’t control, throwing Heineken’s takeover of APB into doubt. Heineken had originally been spurred to bid for control of APB, which it held 42 percent of, after a company controlled by Charoen’s son-in- law bought shares in APB.

Final Offer

The agreement “should be very positive for Heineken’s share price,” said Gerard Rijk, an analyst at ING Groep NV (INGA) in Amsterdam. “The company will not need to raise its offer further and it will be able to consolidate the APB business.”

F&N shareholders are scheduled to meet Sept. 28 to vote on Heineken’s offer to buy F&N’s shares in APB. F&N recommended that holders accept Heineken’s increased S$53-per-share bid in August. Heineken, the world’s most acquisitive brewer in the past 12 months, had said it would be its final offer.

F&N also has a food and soft-drinks unit and a real estate division. TCC Assets, linked to Charoen’s Thai Bev, offered S$8.88 a share for F&N. The bid is the largest announced by a Thai company in at least 10 years, according to data compiled by Bloomberg.

Charoen’s agreement to support Heineken’s offer for APB may spur speculation that he would break up F&N, a 129-year-old group. Japan’s Kirin Holdings Co. (2503) owns a 15 percent stake in F&N and had considered making a bid for its food and soft-drinks unit, several people with knowledge of the matter said in August. Coca-Cola Co. (KO) explored a bid for the drinks operations, people with knowledge said.

F&N got 30 percent of its 2011 revenue of S$6.3 billion from property, 12 percent from soft drinks and 17 percent from dairies, according to data compiled by Bloomberg.

http://www.bloomberg.com/news/2012-09-18/heineken-says-thaibev-tcc-agree-to-support-its-offer-for-apb.html

ThaiBev in talks with partner to take over Singapore F&N

(Reuters) - Thai Beverage PCL (TBEV.SI) said it was in talks with a partner to team up on a bid for Fraser and Neave Ltd (F&N) (FRNM.SI), moving the Thai group a step closer in its effort to snap up the remaining pieces of the Singapore conglomerate.

For two months, ThaiBev and Heineken battled for control of Asia Pacific Breweries Ltd (APB) (APBB.SI), one of the region's largest beer makers. But with F&N agreeing to sell its APB stake to Heineken after the Dutch giant sweetened its offer, ThaiBev is now turning its focus on F&N, a drinks distributor and holder of one of Asia's biggest real estate portfolios.

"A party acting in concert with the company is exploring the possibility of making an offer for F&N," ThaiBev, controlled by billionaire Charoen Sirivadhanabhakdi, said in a filing on the Singapore Exchange early on Tuesday. It did not identify the partner.

F&N has scheduled a shareholder vote on September 28 to approve the sale of a 40 percent stake in APB to Heineken. ThaiBev is F&N's biggest shareholder with a 29 percent stake.

Heineken, which also has a stake in APB, raised its offer last month to buy out APB shares held by F&N and minority shareholders to $6.3 billion. The move was seen as an attempt to fend off Charoen in a battle for control of a leading brand in the fast-growing Southeast Asian beer market.

A source familiar with the matter told Reuters that Charoen is now taking steps to ensure that his group is in a strong position to influence the outcome of the potential break-up of F&N after extracting a higher offer from Heineken.

The Thai group, facing a major cash windfall from the APB sale, is unlikely to take further steps in squeezing Heineken's offer, sources familiar with the matter said, declining to be identified because details of the plan were confidential.

ThaiBev has spent S$3.6 billion ($2.92 billion) to build its stake in F&N to 29 percent. The purchase includes a block of F&N shares the Thai brewer acquired from Singapore's Oversea-Chinese Banking Corp (OCBC.SI) group at S$8.88 each.

F&N shares were trading at S$8.54 in early trading on Tuesday, down 0.12 percent.

PROPERTY PORTFOLIO

ThaiBev's "holding announcement" did not state whether the partner was a member of Charoen's TCC Group or an unrelated firm. Analysts have speculated previously he may try to bring in a partner to buy part of F&N's large property holdings.

F&N's property portfolio, worth over S$8 billion, as well as its beverage business could be of interest to Charoen, analysts said previously. But Thailand's third-richest man would still need a partner to bid for those assets.

"We believe ThaiBev would be stretched financially to make a sole bid for F&N, hence the potential joint offer with another party," said Goh Han Peng, an analyst at DMG & Partners Securities.

Blackstone Group (BX.N) and other global property companies have also had a look at F&N's property business, sources previously told Reuters.

F&N's beverage business has attracted suitors including Coca-Cola Co (KO.N) and Japan's Kirin Holdings Ltd (2503.T), which already owns 14.9 percent of F&N.

Besides market-leading positions in soft drinks and dairies in Singapore, Malaysia and Thailand, F&N also has distribution reach in emerging markets such as Vietnam and Myanmar, according to a DMG report.

LOAN

ThaiBev said it has been in talks with banks to refinance a loan taken out to fund its initial stake purchase in F&N. Under Singapore law, it would be required to bid for all of F&N if its holding rose to 30 percent.

"The company is not seeking funding for a potential general offer for F&N," it said.

On Monday, Basis Point reported, citing banking sources, ThaiBev was seeking proposals for a loan of around S$9 billion and had contacted several lenders, including Singapore, Malaysian and Japanese banks.

Analysts have cautioned against discounting Charoen, who is known for being a dogged fighter. The billionaire is estimated by Forbes to be worth $6.2 billion.

Charoen has consistently shown in the past a "willingness to take risks and face down competitors," said Mykolas Rambus, CEO of Singapore-based consultancy Wealth-X.

http://www.reuters.com/article/2012/09/11/us-thaibeverage-fraserneave-idUSBRE88A04U20120911

Heineken Said In Talks With F&N To Raise APB Bid

Heineken NV (HEIA) is in talks with Fraser & Neave Ltd. (FNN) about raising its $6 billion bid for the rest of Asia Pacific Breweries Ltd. (APB), the maker of Tiger beer, said three people with knowledge of the matter.

It wasn’t immediately clear how much Heineken would boost its S$50 ($40) per share bid for APB, said two of the people, who asked not to be identified as the process is private. Kindest Place Groups, owned by the son-in-law of Thai billionaire Charoen Sirivadhanabhakdi, has offered to buy 7.3 percent of APB from F&N for S$55 per share.

The Dutch brewer has sought full control of the Tiger beer maker as it attempts to protect its hold over a key emerging-market business and as brewing assets in high-growth economies are in short supply after a decade of consolidation in the industry.

F&N owns 40 percent of APB while Heineken, the world’s third-biggest brewer, holds a 42 percent stake. The Dutch brewer has sought full control of the Tiger beer maker as it attempts to protect its hold over a key emerging-market business and as brewing assets in high-growth economies are in short supply after a decade of consolidation in the industry.

“At the end of the day, the F&N board needs to decide whether selling everything for S$50 is a better outcome for shareholders than selling 7.3 percent for S$55,” said Jonathan Foster, Singapore-based director of Global Special Situations at Religare Capital Markets. “It just depends on how that negotiation goes between Heineken and the F&N board, and how tough Heineken is able to play it.”
Asian Expansion

APB and F&N were both suspended from trading in Singapore today. Charoen’s Thai Beverage Pcl (THBEV) is unchanged at 33.5 Singapore cents as of 3:57 p.m. in the city-state, after rising as much as 1.5 percent. Heineken shares were down 0.35 percent to 43.64 euros at 10:23 a.m. in Amsterdam.
Heineken was spurred to make an offer for APB last month after Charoen’s Thai Beverage Pcl bid for a 22 percent stake in F&N. Kindest Place also agreed to buy about a 9 percent stake in APB at that time. The moves would potentially have infringed on the Dutch company’s influence over its brewing operations with APB, which has rights to brew Bintang beer in Indonesia, Anchor in China, Southeast Asia and Sri Lanka, and Heineken from China to New Zealand.

Heineken spokesman Charles Armitstead was not immediately available for comment. Reuters reported the talks earlier today, citing unidentified people. The Thai company may have put in the higher bid to get Heineken to raise its offer, Lee Syn Yi, a Singapore-based equity analyst at CIMB-GK Pte. Charoen’s family is already benefiting from a rise in APB’s stock. The value of Kindest Place’s 8.6 percent stake in APB has already risen by S$124 million based on the purchase price of S$45 a share.

Overseas Expansion
Thai Bev said last month that the F&N stake will allow it to expand its “non-alcoholic product portfolio” and to diversify geographically. The Thai brewer could also benefit from any dividends that F&N pays out from sale its stake in APB.

Deutsche Bank analyst Gregory Lui estimated in a July note that a sale of APB at S$50 a share could provide F&N and its shareholders “significant” one-time gains and special dividends of about S$2.71 a share.

Born and raised in Bangkok’s Chinatown district, Charoen started a trading business that supplied distilleries and became a distiller after being awarded concessions to produce liquor in Thailand.

‘Winner Both Ways’
“Thai Bev is a winner both ways,” said Jenai Chua, a Singapore-based analyst at Bank Julius Baer in an interview earlier this month. “If the APB sale goes through, they can still make a pretty big disposal gain should F&N decide to distribute proceeds of the sale to shareholders as dividend. If it doesn’t go through, they get a chunk of a very lucrative and well-established beer business.”

Trevor Sterling, analyst at Sanford C. Bernstein, said that Kindest Place was probably seeking to benefit financially from any increase in Heineken’s offer, and may try to influence APB strategy with a possible deal to cooperate in Thailand. “They probably have flexible objectives,” he said.

Heineken, which accounts for about 8.8 percent of the global beer market, is seeking to expand in faster-growing regions such as Southeast Asia amid weak consumer spending in the developed markets of Europe and the U.S. The company has the smallest presence in emerging markets among the world’s top three brewers, according to data compiled by Bloomberg. About 37 percent of operating income came from western Europe last year.

A sale of its stake in APB’s brewing business, could also draw acquisition interest in other parts of F&N, which also has soft drink and real estate operations. Japan’s Kirin Holdings Co. (2503) has said it is interested in F&N’s soft drink and food operations.

The purchases by Thai Beverage and Kindest were completed this week. Thai Beverage has since raised its stake in F&N to 26.4 percent.

ST ENGINEERING’S AEROSPACE ARM WILL NOT PROCEED WITH ACQUISITION OF PEMCO

Singapore, 6 August 2012 – Singapore Technologies Engineering Ltd (ST Engineering)
announced today that further to its announcement on 18 June 2012, Vision Technologies
Aerospace Incorporated (VT Aerospace) and Pemco World Air Services Inc. (PEMCO) have
agreed to terminate their asset purchase agreement whereby VT Aerospace intended to
acquire PEMCO's Tampa aerospace facility and certain other assets. The decision to
terminate the agreement was made after certain closing conditions could not be fulfilled by
the seller prior to the closing deadline

http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_01EB80B998E9875048257A5200035A02/$file/Aero_not_proceed_acq_PEMCO.pdf?openelement

DBS sees pressure on margins as Q2 profit beats forecasts

* Q2 net profit S$810 mln vs S$795 mln expected by analysts

* DBS sees some pressure on interest margins, especially in China

* Says committed to pursue Indonesia's Danamon deal

By Saeed Azhar

SINGAPORE, Aug 3 (Reuters) - Singapore bank DBS warned of pressure on interest margins, especially in China, and flagged risks to loan growth, even as it beat forecasts with a 10 percent rise in its second-quarter profit.

The warning mirrored comments by rival Oversea-Chinese Chinese Banking Corp as Singapore lenders brace for an Asian slowdown amid concerns that Europe's debt crisis could dampen business and trade activities in the region.

DBS, Southeast Asia's biggest lender, posted a net profit of S$810 million ($648 million) for April-June against S$735 million a year earlier.

The result was ahead of an average forecast of S$795 million, according to six analysts surveyed by Reuters, but below the first quarter's record S$933 million profit.

Analysts expect DBS to begin a formal regulatory application process for its planned $7.2 billion acquisition of Indonesia's Bank Danamon afterIndonesia came up with new rules to restrict ownership of banks, but allowed some exceptions.

DBS Chairman Peter Seah said in a statement the bank was committed to pursue the Danamon deal and would be fully guided by Bank Indonesia "at every step of the way".

Singapore state investor Temasek owns about 29 percent of DBS, but its stake would rise to 40 percent if the DBS-Bank Danamon deal goes ahead.

The results came after OCBC, Singapore's second-biggest bank, warned on Thursday that loan growth will slow and margins remain under pressure after it posted a better-than-expected rise in quarterly profit.

United Overseas Bank, the smallest of Singapore's top three lenders, will report earnings on Tuesday.

DBS's net interest income, or income from the core lending business, rose 10 percent to S$1.3 billion from a year earlier, as loans expanded by 22 percent. DBS' net interest margin, however, declined by 8 basis points from a year earlier to 1.80 percent in the second quarter.

"Loan pipeline remains healthy, although some headwinds likely," DBS said in its presentation notes. "Expect a little margin pressure, especially in China."

Net fee and commission income fell 2 percent from a year ago to S$379 million, on volatile markets. Bad-debt charges dropped 24 percent to S$104 million.

DBS shares are up about 28 percent so far this year, slightly below UOB's near 30 percent rise, but higher than OCBC's 21 percent jump. The benchmark Straits Times Index is up about 15 percent in 2012.

http://www.reuters.com/article/2012/08/03/dbs-earnings-idUSL4E8J21ND20120803?type=companyNews

Singapore's F&N, APB shares halted ahead of Heineken offer decision

(Reuters) - Shares of Fraser and Neave (F&N) (FRNM.SI) and Asia Pacific Breweries (APB) (APBB.SI) were suspended on Thursday from trading, after sources said F&N is pressing for a better offer for its stake in APB than the $4.1 billion offered by its partner Heineken NV (HEIN.AS).

The Dutch brewer and F&N are embroiled in a tussle over APB, the producer of Tiger Beer. Heineken moved to protect its interests in APB by offering F&N $4.1 billion to take effective control of APB. It will then have to offer another $2 billion in a public tender for minority stakes in the company.

Heineken's move came after companies linked to Thai tycoon Charoen Sirivadhanabhakdi bought stakes in both F&N and APB for $3 billion last month. Thai Beverage PCL (TBEV.SI), controlled by Charoen, has since raised its stake in F&N to 24.1 percent, according to stock exchange filings.

Coca-Cola Co (KO.N), the world's largest soft-drinks maker, is exploring a bid for the beverage unit of Singapore's F&N, Bloomberg reported on Wednesday, citing several people with knowledge of the matter.

A source familiar with the situation told Reuters Coke "is showing a lot of interest in this." Banking sources have said a bid for the beverage business is only possible if F&N is broken up.

F&N and Coca-Cola ended last year their partnership under which F&N used to bottle and sell Coca-Cola's drinks in Malaysia, while Coca-Cola did the same for F&N in Singapore.

The bulk of the food and beverages business is locked up in Malaysian listed entity Fraser and Neave (FRAS.KL) which has a market value of about $2.2 billion.

BID EXTENDED

Heineken extended on Friday its bid for F&N's APB stake by one week, and sources told Reuters F&N's board is pressing for a better offer for the stake.

"Heineken is the one with the bigger muscle, they're the stronger party but they definitely have to come up with an offer that no one can resist, so the question is what is that price? Heineken has to test it out," said Roger Tan, CEO of SIAS Research.

Singapore-based brewer APB, the crown jewel in the F&N stable, is attractive to other beer companies due to its foothold in the fast-growing Asian market.

European analysts say the deal would increase the proportion of Heineken's profits from the Asia-Pacific region to 15 percent from 6 percent, raising the growth rate of the whole group.

F&N shares have jumped 31.5 percent so far this year to close at S$8.15 on Wednesday, but have come off a record high of S$8.49. APB shares, which last traded at S$49.50, have surged 71.9 percent since the start of the year.

Thai Bev this week obtained a key waiver from the Singapore Exchange that will accelerate its move to become the biggest shareholder of F&N, owning 24.1 percent stake, ahead of 15 percent owned by Japan's Kirin Holdings (2503.T). ($1 = 1.2443 Singapore dollars)

http://www.reuters.com/article/2012/08/02/us-apb-heineken-halt-idUSBRE87103G20120802

OCBC says Q2 net profit up 12 pct, beats expectations

Aug 2 (Reuters) - Oversea-Chinese Banking Corp , Singapore's second-largest lender, posted a 12 percent rise in second-quarter net profit on Thursday, helped by strong loan growth and a surge in trading income.

OCBC earned S$648 million ($521 million) in the three months ended June, compared to S$577 million a year earlier. Its profit was higher than the S$606 million average forecast of six analysts polled by Reuters.

The beat was largely due to strong rise in net trading income to S$75 million, an increase of 84 percent from a year earlier, led by higher securities and derivatives trading income.

Trade finance and housing helped fuel strong loan growth for Singapore banks this year, but analysts expect the pace of credit expansion to slacken in the second half of 2012 as Asian economies slow.

Bank loans in the wealthy city-state grew nearly 21 percent in June from a year earlier, central bank data shows.

Analysts expect higher dividends from OCBC in the months ahead after it agreed to sell its stakes in Fraser and Neave and Asia Pacific Breweries to a group of companies linked to Thai billionaire Charoen Sirivadhanabhakdi.

OCBC said on July 18 the banking group would make a post-tax gain of about S$1.15 billion from the deal.

In 2011 it paid a total dividend of 30 cents per share, unchanged from 2010.

http://in.reuters.com/article/2012/08/01/ocbc-results-q-idINL4E8J17JM20120801