Friday, September 20, 2013
Albedo: the key takeaway is that the key investor, Danny Tan , will be acquiring the majority stake in Albedo at 2.24¢, which represents a 67% discount to the current 6.8¢ last traded price. Investors who want to get a piece of the pie at this stage, have to stump up a hefty premium. Note however, that execution risk is the biggest risk factor here. There are numerous conditions that need to be fulfilled for the deal to go through, including: getting shareholders approval at an EGM, negotiating land purchases, etc. The concept of theoretical price is not applicable in this case, as this is not a straight forward rights or bonus issue. It is also impossible at this stage to conduct any form of fundamental analysis, because the land purchase deals are still under negotiations , and the company has no track record in the property development business.