SingPost sells nearly half its GDex stake to Yamato, reaps S$64m gain

by **Cals** Mon 22 Feb 2016, 02:43

SingPost sells nearly half its GDex stake to Yamato, reaps S$64m gain

By Billy Toh / The Edge Financial Daily | February 19, 2016 : 9:50 AM MYT

This article first appeared in The Edge Financial Daily, on February 19, 2016.

KUALA LUMPUR: Singapore Post Ltd (SingPost) has sold down its stake in local courier company GD Express Carrier Bhd (GDex) by selling 10% or 137.42 million shares to Japan’s Yamato Asia Pte Ltd for RM239.1 million through an off-market transaction.

The share disposal brings the Singapore firm’s stake in GDex to 11.232% or 155.37 million shares, while retaining its board seat at the company.

GDex’s filing with Bursa Malaysia yesterday showed that SingPost and Yamato entered into a share sale agreement last Friday, and the transaction price was RM1.74 apiece, which is 4.2% higher than yesterday’s closing price of RM1.67. The transaction was completed yesterday.

In a separate statement yesterday, SingPost said from this partial divestment, it recognised a net gain of S$64 million (RM190.17 million), which is about five times return on its initial investment.

“The reduction in the stake will free up capital to allow the group to strengthen its financial capability, while maintaining flexibility for future growth,” said SingPost deputy group chief executive officer (corporate services) and group chief financial officer Mervyn Lim.

“This deal gave us a good return on our investment and also boosted our available resources to drive SingPost’s e-commerce logistics growth, as it pivots into the United States with the recent investments in TradeGlobal and Jagged Peak,” he added.

Lim also noted that as SingPost had interlinked systems with GDex, it will continue to reap business synergies through its GDex business collaboration, with an added uplift strategic partner Yamato brings to GDex.

On Jan 21, GDex placed out 10% of its shares to Yamato in a deal worth RM217.31 million.

Yamato also made its intention known then that it will be acquiring more shares in GDex from existing shareholders to increase its stake to 23% in the future.

At yesterday’s closing, GDex was trading at RM1.67, a trailing 12-month price-earnings ratio of 78.7 times and 15 times book value.