Tee International

Tee International: Group announced that it has entered into an agreement with Yongnam Holdings Limited and Samwoh Corporation Pte. Ltd. for the purposes of investing into a consortium with JGC Corporation and Changi Airport Planners and Engineers Pte. Ltd. to jointly participate in the submission of a tender for the construction, management, operation and maintenance of the Hanthawaddy International Airport in Myanmar. TEE and Samwoh will each take a 25% stake in the SPV that will in turn supply up to 60% of the project consortium’s equity. Yongnam will own 50% of the SPV and represent it in all negotiations involving the project. Tee International last signed an MOU (9 Nov 2012) with Ayeyarwaddy Cement- a subsidiary of A1 Group, to set up a JV-company to develop and operate a fully integrated cement plant to manufacture portland cement for sale in Myanmar. Group is currently in the midst of technical studies, with the JV to be formed by 31 Jul 2013. Tee also has plans to spin of its real estate business (current property asset value worth $16m) and list it separately on SGX (around May 2013). The co has stressed that it intends to retain a 70-75% stake in the business and not to cash out of a valuable source of future earnings for the group. Tee plans to payout part of the proceeds from the proposed spin off as a special div and use the rest to fund its expansion into new ventures such as the cement business that it is exploring in Myanmar. The real estate business accounted for 56% ($135m) of the group’s FY12 total assets, 8% ($12m) of revenue, and 22% ($4.8m) of operating profit. As of 6 Dec 2012, the Company's engineering segment has an outsanding order book of approx $299.5m. OCBC has a HOLD rating, TP of $0.30;