Singapore Labour Foundation reveals sell-down of ComfortDelgro shares

It sold two-thirds of its stake.

According to Nomura, Singapore Labour Foundation (SLF) placed out 170mn shares or ~2/3 of their stake in ComfortDelgro last evening. 

This represents ~8% of total shares outstanding in ComfortDelgro. The transaction was priced at S$1.94, which is the low end of the pricing range (S$1.94 – S$2.03).

Here's more from Nomura:

The transacted price represents an 11% discount to its last close of S$2.18.We do not profess to know the reason behind SLF’s sell-down, but this placement does not change the fundamentals of the company – i.e., in our view, good management, strong balance sheet and potential accretion from M&A.

To put things in perspective, SLF last sold down their stake in the market in 2006, on Valentine’s Day. Naturally, the stock corrected but quickly recovered in the next couple of weeks.

As such, we suggest that investors focus on the facts and judge the company by its fundamentals and not the noise generated by this transaction. We maintain a BUY on the stock at current levels.