NOL

NOL: said it intends to sell its Spore HQ building at Alexandra Road. The co has not decided on a reserve price for the 29-yr-old freehold building but said it is selling the property to release capital for strategic investment. Recall the co had recently attempted a capital raising in the form of perpetual securities, but pulled out at the last minute. The co then said it was looking for invmt opportunities in the logistics space. NOL has appointed Jones Lang LaSalle to market the property. About 500 people work in the 26-storey tower. The co said a decision to relocate them or remain in the existing building as a tenant will have to wait until a buyer is identified. The sale will be made subject to customary terms and conditions, required regulatory and/or any other approvals. JLL says that the freehold NOL Building is on a 108k sf site zoned for commercial use. It has a GFA of 294.5k sf, an existing NLA of 207.5 sf and 276 car park lots in a separate podium. Adds, NOL currently occupies 90% of the building and is expected to lease back the premises. While the proposed property sale may seem negative from a PR point of view, it may be actually be one of the more viable means of funding options available to NOL. With a slew of mega container ship deliveries due, NOL may be taking steps to build a capital buffer in the midst of the current tight shipping credit environment. Also, NOL may realize better valuations from the sale of its property asset, with property prices currently at lofty levels, vs selling equity (at its current 1x P/B valuation) or selling debt (at relatively higher interest rates). Technically, NOL is a potential break up candidate, as share price has just broken above the key $1.105 resistance (convergence btwn a Fibo level and the 50day MA). The key indicators are above neutral and rising, and suggest near term momentum could continue. Further upward moves could lead to a test of the $1.20 resistance (convergence btwn another Fibo level and the 200day MA). Support at $1.10.