Expect more privatisations for Singapore firms, say analysts

O&M, tech, and property firms are all looking to privatise.

The recent flurry of offers from listed companies for privatisation has sparked a trend of privatising in the Singapore market.

In recent months, big names such as OSIM, Interplex, Tat Hong, and Innovalues have all announced offers or potential offers with the aim of privatisation, according to analysts from OCBC.

“Indeed, given how much share prices have declined and how attractive valuations are for certain companies out there, it is not surprising that bargain hunters are once again on the prowl for good deals,” OCBC said.

At the same time, OCBC added, a world centred on liquidity meant that capital costs have remained low, especially for stronger corporates and individuals.

Additionally, investors still have faith in the long-term prospects of Asia, and many companies on the local bourse have huge exposure to this market.

“A dim outlook in the near term is by no means a sure bet on share price underperformance, as holding companies and individuals are still flush with cash and ready to take companies private if they are comfortable with the companies’ long term outlook,” OCBC said.

“Based on our screening, companies that are more likely to be privatised or taken over include Dyna-Mac Holdings, PEC Ltd, PACC Offshore Services Holdings, Pacific Radiance, Baker Tech, Triyards, KS Energy, Mermaid Maritime, KrisEnergy, ASL Marine, Innovalues, Sunningdale Tech, Wing Tai, Wheelock Properties (S), Parkson Retail Asia, Courts Asia, Banyan Tree, CWT, Cogent Holdings and Tat Hong,” OCBC said.