SINGAPORE (May 13): The Lee family that controls Sing Investments & Finance (SIF) recently raised its stake in the company via FH Lee Holdings to just a shade below the 30% mandatory takeover mark as stipulated by Singapore company laws. The last time the Lees bought shares in the finance firm was nearly a year ago.
According to a May 8 filing, FH Lee, the single-largest shareholder of SIF, bought 18,800 shares at an average price of $1.47 each on May 6 from the open market. On May 7, it bought another 22,000 shares at $1.4786 each. This raises FH Lee’s stake from 43.83 million shares to 43.87 million shares, or a stake of 27.83%, from 27.804% prior to the purchase.
Besides the direct stake, FH Lee holds a deemed stake of nearly 2.85 million shares, or 1.805%, in SIF. This brings FH Lee’s total stake of deemed and direct holdings to more than 46.7 million shares, or 29.635%.
Year to date, SIF’s share price has barely budged from $1.45 at the beginning of the year. It closed at $1.47 on May 6. At this level, the company is valued at $231.7 million. As at March 31, the company’s net asset value (NAV) was $2.33 a share, up slightly from $2.30 as at Dec 31, 2018 — which indicates a significant discount of 36.9% off current market prices.
SIF ended FY2018 on a high but had a slower start to the current financial year. For the year ended Dec 31, 2018, it grew earnings by 5.9% over FY2017 to $24 million. Its loan book grew 9% to $2.08 billion. However, for the three months to March 31, the company reported a 19.7% y-o-y drop in earnings to $5 million. The drop was attributed to lower net interest income and higher operating costs. Its loan book, as at March 31, was down slightly from the preceding quarter to $2.05 billion.
“In view of the cautious and uncertain economic outlook for the rest of 2019, the group will continue to be vigilant in risk monitoring as well as prudent in our credit-granting criteria as we seek new business opportunities,” states the company in its 1Q earnings statement of April 25.
The last time FH Lee bought shares in SIF was on June 6, 2018. Back then, the Lees paid $1.53 on average for 1.45 million shares via a married deal. The following day, it bought 50,000 shares at the same price. In November 2017, FH Lee bought 1.55 million shares via a married deal, also at $1.53 each.
The deemed beneficiaries of FH Lee are Lee Sze Leong, Lee Sze Siong and Lee Sze Hao. Sze Leong is managing director of SIF and Sze Siong is deputy managing director. Sze Hao does not sit on SIF’s board. However, he is managing director of Sing Holdings, a separately listed property developer that is also controlled by the Lees via FH Lee, with a 35.47% stake.
For the year ended Dec 31, 2018, Sing Holdings reported a fourfold surge in earnings to $13.7 million, as the company recognised sales from its 70% stake in a recent residential development, Parc Botannia. Sing Holdings’ NAV as at Dec 31, 2018 was 64.62 cents a share, up from 63.53 cents a share as at Dec 31, 2017. On Dec 13, 2018, Sze Hao bought 50,000 Sing Holding shares at 38.5 cents each. Sing Holdings closed on May 6 at 39 cents.
