STX OSV

STX OSV: OCBC notes despite rumors of STX Corp selling its entire 50.75% at $1.60/sh by end May ’12, nothing has materialized yet, raising questions if the deal is already dead or still under negotiation. The house notes rumors also that STX Corp will not seek a mgt premium for the shares. This has led to the recent slump in STX OSV’s share price. The house reminds to be cautious when acting on mkt rumors. Notes M&A activities are highly confidential and it is unusual for “leaks” to occur. Nevertheless, OCBC believes the mkt has overreacted. Says STX OSV remains a strong co with a gd track record. The stock trades at 6.5x P/E and est div yield of at least 5%. Keeps at Buy with TP $2.