How UOL was able to milk gains from Marina Centre Holdings

It has direct 22.7% stake.

According to Nomura, both UOL and Singapore Land (SL SP, not rated) have outperformed the broader market YTD, up 17.9% and 23.7% respectively vs. the FSSTI’s gain of 3.8%, and we believe Marina Centre Holdings (MCH, unlisted), in which UOL and SL have direct stakes of 22.7% and 53% respectively, could have been the principal driver.

Nomura said they have been highlighting the redevelopment potential of the Marina Square assets owned by MCH since 2010 and it appears, with the provisional permission for the extension to the mall being obtained in 2012, the conversion of the now vacant office component (Marina Bayfront) into additional retail space could now take place.

"While the scale of the potential redevelopment is much smaller than what we had anticipated (after all Marina Bayfront’s current NLA is less than 80,000 sq ft), it appears the value of UIC’s (UIC SP, not rated) portfolio (including that of MCH) is being enhanced notwithstanding entities controlled by the Wee family have yet to gain the majority stake in the company (48.4% as of 8 March 2013)," Nomura said in a report.