Capitland

Capitland: Announced this morning that it has placed out its remaining 39.1% stake in Australand at an average price of A$3.75 per share, which represents a 3.6% discount from its last traded price and a 5.3% premium from last reported NTA. The sale will raise total proceeds of S$970.1m and result in a net gain of $35.7m. The group noted that it conducted a partial sale in Nov-13 to improve trading liquidity, which subsequently provided an opportunity for the group to sell its remaining AustraLand stake at a more favorable valuation closer in line with that of peers. Overall, the house have a favorable view on this action and believe that the market will likely take this positively as well, given the possibility of a special dividend from the sale proceeds later this year. Strategically, this divestment will further simplify the group’s structure and enable management to recycle capital into key markets - Singapore and China. The sale is estimated to further boost the group’s cash holdings to approximately $6.9b and reduce gearing to about 29%. Maintain BUY on CAPL with an unchanged fair value estimate of $3.50.