Wheelock / SC Global

Wheelock: stock is +4.1% at $1.925, likely in part boosted by Aberdeen coming on board as a significant shareholder, after raising its stake via open mkt purchases to 5.006% on 3 Nov. Separately, we note that SC Global called for a trading halt on 3 Nov, "pending release of announcement". Given that Wheelock owns 15.8% of SC Global, there could be some positive expectation with regard to SC Global's next move. In the past, there was mkt talk with the passing of Wheelock CEO David Lawrence, Wheelock might be open to streamlining its assets, allowing for possible divestment of SC Global, and paving the way for a possible privatisation of SC Global. SC Global may have incentive to be a private co. Under the Residential Property Act, housing developers whose sh/h and directors are not all Singaporeans have to get a Qualifying Certificate (QC) to buy residential property for devt. This is imposed to control foreign ownership of land. This gives developers up to 5 yrs to build the project and requires them to sell all the units within 2 yrs of TOP . An "extension charge" may be levied if it cannot sell all its units after the two-year deadline. Developers pay 8% , 16% and 24% of the property purchase price for the first, second and third extra years, respectively. The amount is pro-rated based on the proportion of unsold units. 6 developers have so far paid charges. The Straits Times notes at least 8 private housing projects, mostly in prime areas, likely running out of time to sell their units within the two yrs of completion. Amongst which, comprises SC Global's The Marq on Paterson Hill (33 unsold units) and its 241 unit Hilltops completed in 2Q11 (196 apts unsold as at end Sep). Wheelock's Scotts Square in Scotts Road, completed in 3Q11, also has 72 units unsold.