Silverlake

Silverlake: trading halt to be lifted at 9am this morning.
Selected to be one of four key technology partners to implement CIMB’s 1Platform, a regional core banking platform costing RM 1.1bn in total. The platform will be rolled out across Malaysia, Indonesia, Singapore and Thailand over the next 5 yrs. 1Platform is the largest component of CIMB’s regional operations transformation blueprint expected to cost RM 2.1bn…

Silverlake will provide the core banking system for the platform. Contract value was not disclosed, but is likely sizeable. The contract win signals a vote of confidence in Silverlake’s capability as one of the world’s leading technology providers. It also paves the way for Silverlake to bid for the rest of CIMB’s blueprint components involving systems for financial reporting and mgt, integrated HR mgt, front-end sales mgt and regional transaction banking…

Last week, we highlighted Silverlake as a possible turnaround play following its FYJun10 results. Mgt was upbeat on outlook, and highlighted that banks and financial institutions could be resuming investment in systems again, after deferring capital spending last year. Stock has been underappreciated for some time, and further catalysts (ie. New orders) could result in a significant rerating…

Stock trades at 25x PE, but valuations likely to narrow to just 12.6x fwd PE on high growth prospects, according to Bloomberg est.