Gallant

Gallant Venture +3.6% to $0.29 despite acquiring a 52.4% stake in Indon-listed autoparts company Indomobil Sukses Internasional , which is alien from its current resorts, property and utilities businesses and funding its US$809.3m purchase via a 1-for-1 rights issue. But the deal may be a sweetheart offer priced at only 1.3% premium above Indomobil's closing price and shifts the bulk of one of Indon's major auto-parts players to S’pore, giving local investors an alternative to Jardine C&C to play on Indonesia's growing auto sector. While the rights price of $0.28 each offers no discount from Gallant's previous close, it could improve Gallant's liquidity as more than 77% of Gallant's shares are currently locked up by its top 2 shareholders, Salim and Sembcorp Industries With Salim Group controlling 53.4% of Gallant and at least 18.1% of Indomobil, the deal also puts Indomobil's ownership a full circle post Asian Financial Crisis. Recall the Indon govt sold off Suharto-linked Salim's Indomobil stake in 2001 as repayment for bailing out Salim's then crown jewel Bank Central Asia, which was nationalized in 1998.