Olam to receive all-cash offer from Breedens Investments

Offer price at S$2.23 per share.

Breedens Investments Pte. Ltd. (Breedens) has announced that it intends to make an all-cash Voluntary Conditional General Offer (“Offer”) for all shares in Olam International Limited (Olam).

Breedens, an indirect wholly owned subsidiary of Singapore investment company Temasek Holdings (Private) Limited, also intends to make an offer for the outstanding convertible bonds and outstanding warrants issued by Olam.

Breedens leads a consortium which includes Aranda Investments Pte. Ltd. (Aranda), Olam founding family shareholders and 10 members of the Olam executive committee, including Olam CEO Sunny Verghese. Breedens and Aranda together hold the largest stake of 24.6% in Olam, followed by Olam founding family shareholders with the second largest stake of 20.2%. Together, the consortium owns a combined majority stake of 52.5% in Olam.

The Offer price of S$2.23 per share represents: a price which exceeds the highest transacted price in the 52 weeks preceding the Offer Announcement; a premium of 11.8% over the last traded price on the last full trading day immediately preceding the Offer Announcement; and 24.2%, 32.4% and 39.5% over the one-month, three-month and six-month VWAP respectively, preceding the Offer Announcement.

With the Offer, minority shareholders will have the flexibility to tender all, part or none of their Olam shares in acceptance of the Offer. By tendering part of their shares, minority shareholders can create a balance between monetisation and continued participation in Olam’s potential growth over the long term.

Through this Offer, Breedens wishes to provide Olam with a stronger long term shareholder base to support Olam’s strategy and growth plans over the medium to long term.

Mr David Heng, Director of Breedens, said, “Members of our consortium are all long term shareholders of Olam. We have invested in Olam over the years, and share a common investment philosophy to invest and build for the long term.” He added, “We believe a successful offer will provide Olam with a stronger and more stable shareholder base to support Olam’s strategy and business model for the long term.”

He further noted, “We prefer to keep Olam as a listed company, which will continue to be guided by its board and management team. However, we will reassess our position if the minimum public float requirements are not met at the close of the Offer.”

Olam founding family shareholders and Key Management are acting in concert with Breedens for this Offer.

The Olam founding family shareholders and Key Management have agreed not to dispose of their stakes without Breedens’ consent during the Offer period and six months thereafter. They have also given Breedens a pre-emption right to purchase their shares, subject to certain limited exceptions as specified in the consortium agreement. Olam founding family shareholders and three members of Key Management have agreed to tender a 5.6% shareholding interest in Olam in acceptance of the Offer.

Source : Yahoo.com

Why Critical Illness insurance is important?

• Do you know Cancer is the No.1 killer in Singapore?
• Do you know 1 in 4 Singaporeans die of Cancer?
• Are you aware the cost of healthcare increase much more than the normal inflation?

What is Critical Illness Cover?

Critical Illness cover is a type of health insurance that pays out a tax-free lump sum if you are diagnosed with an illness that is deemed to be life-threatening under the terms of your policy.

This means that if you have critical illness cover in place and are diagnosed with one of the conditions, you will receive a lump sum payout from your insurer to maintain the same lifestyle during the period when you are undergoing treatment to cover the loss of income.

Please watch this Video on the importance of CI cover.

How much is an adequate cover to provide financial security for the family?

The primary purpose of any insurance policy is that it should be useful on major unforeseen circumstances. For eg, A whole life policy has huge advantages, but if the total coverage is going to be only $100,000, the benefit wouldn't provide enough financial security for the family. So it's important to cover with a pure term as a priority, if one cant afford whole life, at least till another income replacement starts with the family.

For Critical Illness cover, an adequate protection could be anywhere between 3-5 years of monthly expenses. Eg. If your monthly requirement is $5,000, to maintain the same lifestyle, an adequate cover for the sole bread winner would be $300,000 in coverage and $200,000 in case both work.

When is the good time to buy Critical Illness cover ?

Similar to any insurance plans, It's always better to start early at a young age when we are hale and healthy as it not only guarantees complete coverage, but also get the same at a much cheaper price. So start as soon as possible, especially before the health conditions change due to family history or otherwise.

I strongly recommend all parents to cover the kids at a young age.  How many parents are above 40 without any critical illness cover and find it extremely expensive to start cover at 45 and above? Kids need this at some point of time in their life and we could cover for $500,000 for just $5000 that too with a whole-life plan. 

What are the conditions covered ?

Please check the details of Critical Illness covered here

Are you keen for the family to maintain the same lifestyle irrespective of the situation?? If Yes, do give me a call at +65 8113 3272 or reach me at eshers@gmail.com

Have you made your SRS investments yet for the year?

Hello All,

It's that time of the year where we are busy finishing to clear the work for the remainder of the year and get ready for holidays. 

• Would you prefer the investment tax rebates to fund your holidays?
• Are you aware that Employment pass holders and Citizens and PRs could enjoy up to $7000 and $2500 in tax rebates respectively depending on the income?
• Do you know if someone starts SRS at age 30, could get to $1M at retirement with the regular SRS contributions and investments making just 5% returns.

For details on Supplementary Retirement Scheme (SRS) , please refer my earlier post here..

http://eshers-fa.blogspot.sg/2013/06/good-time-to-start-srs-investments-for.html

Features :

• Tax rebates on SRS investments helps to maximize your investment returns.
• Tax rebates provides huge margin of safety on your investments.
• Phased withdrawal post-retirement could mean you could withdraw without paying any tax later..
• Flexible Investment option.
• Investment flexibility on different geographies and also complete list of stocks.

Act NOW! Make your investments before December and enjoy your free holiday..

Please help to forward it to your friends who might find this useful.. 

Regards,

Partha
(+65 81133272)

SRS Investments - Funds performance for the month of July

Hello,

It's back to bit of stability in the month of July after both the Equity and Bond markets lost heavily since Bernanke's comments in May.

Please find below the top performers for the month of July. For the complete list, please click on this link. (aia.com.sg/en/individuals/funds-information/investment-linked-plans/ilp-fund-tools/ilp_fund_quickrank/ilp_fund_quickrank) 

Good luck for the rest of year.

Cheers

Power of disciplined savings and compounding!

"Be decisive. A wrong decision is generally less disastrous than indecision" - Bernhard Langer.

How satisfied are you with your investment plan?

Does your plan take care of the medium term and long term requirements?

What are the consequences of you falling short of your needs at a later stage in life?

What if the long-term inflation is higher than your investment returns?

What if i told that with proper planning, you will only need to set aside half or even a third of what you would need to save ?

Target : $1Million at age 60.

Age	Duration Years	0%	4%	5%	6%
25	35	2,380	1,103	895	701
30	30	2,778	1,442	1,203	996
35	25	3,333	1,946	1,681	1,443
40	20	4,166	2,727	2,435	2,164
45	15	5,555	4,064	3,743	3,438
50	10	8,333	6,792	6,442	6,102

** - Returns above are probable returns for illustration purposes.

From the above table, you could see, you just need to set aside $700 a month if you start early and better manage your investments to make a Million Dollars at age 60. This works out to investment of only $294,000 but grows to $1Million because of disciplined savings, better money management and the power of compounding.

Target : $500 a month

Age	Duration Years	0%	4%	5%	6%
25	35	210,000	452,986	567,037	712,355
30	30	180,000	346,777	415,514	502,257
35	25	150,000	256,916	294,224	346,496
40	20	120,000	183,304	203,629	231,020
45	15	90,000	123,005	132,755	145,409
50	10	60,000	73,609	77,309	81,939

The table above explains the returns for a fixed amount of $500 instead of target of $1M in the first table.

Start early, Be disciplined, Actively manage money and let the power of compounding work in your favor.

“Compound interest is the eighth wonder of the world. He who understands it, earns it ... he who doesn't ... pays it.” ― Albert Einstein

Singapore Press Holdings (SPH) - A stock worth holding, Long term

Update : 26th July 2013.

The Share Transfer Books and Register of Members of the Company will be closed on 6 August 2013 for preparation of dividend warrants. Duly stamped and completed transfers received by our Share Transfer Office, Tricor Barbinder Share Registration Services, 80 Robinson Road #02-00 Singapore 068898, up to 5p.m. on 5 August 2013 will be registered to determine shareholders' entitlements to the special dividend. In respect of shares in securities accounts with The Central Depository (Pte) Limited ("CDP"), the said special dividend will be paid by the Company to CDP which will distribute the dividend to holders of the securities accounts.

Dividend Value : 0.18
Record Date : 05/08/2013
Date Paid/Payable : 16/08/2013

Source : SGX.

Have a good weekend.



The much awaited listing of the SPH(T39.SI) Reit is expected to happen by end of July. It's expected to offer a yield of 6%. SPH Shareholders will get a special dividend of 18cents from the capital raised with this IPO, this pushes the yield for this year closer to 10% this year. (24 cents regular plus 18 cents special dividend).

The stock has recovered from two weeks low of 4.12 to 4.32 at the open this morning on the back of this listing news. 

Look at the 5 years performance when the stock offered 10% yield the last time in 2009 :)

http://finance.yahoo.com/q/bc?s=T39.SI&t=5y&l=on&z=l&q=l&c=

Disclaimer : I currently own the stock 

Please find below the news article.

Source : Bloomberg

Singapore Press Holdings Ltd. (SPH), the newspaper publisher that owns the Paragon mall along the city’s shopping belt, is seeking to raise as much as S$504 million ($394 million) in an initial stock sale of its retail assets.

The real estate investment trust is offering 559.9 million shares at between 85 Singapore cents to 90 Singapore cents, according to a preliminary prospectus filed today with the city-state’s regulator. The offer includes an allotment of 251 million units to cornerstone investors including Great Eastern Life Assurance Co. and Morgan Stanley Investment Management Co., according to the document.

SPH REIT plans to offer a yield of as much as 6 percent based on fiscal 2014 projections for the two malls, which have a combined value of S$3.07 billion, it said. Singapore Press said in May it will hold about 70 percent of the REIT after it goes public, and the proceeds will fund the group’s growth and a special dividend.

“The manager will take an active role in managing and enhancing SPH REIT’s properties,” SPH REIT said in the prospectus, adding that it will “assess acquisition opportunities in line with SPH REIT’s investment objective.”

There is an over-allotment option of 56 million units, it said.

Endowment - A compelling investment option!

Last month, we focused on maximizing our returns using Flexible investments options using SRS here. Today, we will look into the option of maximizing your investments through fixed commitments, with protection for Life and a cheaper rider for critical illnesses as bonus.

I believe that one should always balance the investments between Fixed and Flexible options. Even for people with best investment knowledge and availability of time, there is a huge temptation to exit a flexible plan at every possible downturn. A Fixed option which makes us save every month or year becomes more habitual and enforces financial discipline. It is also less volatile and doesn't require lot of time to manage investments unlike market related instruments.

Think about this - How many people will save $1M dollars with the same discipline as mortgage commitment?

Why Endowment Policies are a good investment option?

Theoretically, it’s possible to get higher returns on equity investments. But, it’s always better to balance the investments between Fixed and Flexible commitments. You could commit for an investment that’s easily serviceable with fixed commitments and the additional you could afford on a flexible basis. The discipline required for fixed commitments will help us accumulate a far better corpus over time than the flexible options, even with slightly lower returns.

The endowment policies in Singapore provide potential returns of approximately 4-5%* which is many times more than the fixed deposits with banks and also better than the long term inflation returns. This is in addition to the protection for Life and a cheaper rider for covering major illnesses during the policy period.

How am I benefitted?

Are you a Singapore tax resident not contributing more than $5000 to CPF yearly? (Most of Employment pass holders, Self-Employed will be benefitted) If yes, please read the following carefully and make the most from your investment.  In my 15 years of investment experience, I would say this is the most compelling benefit to maximize your investment returns. 

The investment, standalone, is an extremely attractive option. The tax relief for insurance makes it a must-have in your portfolio with potential returns of up to 20%, and more importantly comes with the capital guarantee at the end of the policy period.

Life Insurance relief (Source : www.iras.gov.sg)

“Maximum of $5,000 capped at the lower of:

1. Insurance premiums paid in the preceding year; or
2. 7% of capital sum assured on death”

With the highest tax rate of 20%, this potentially translates to rebates of up to 20% depending on your earnings plus the potential 4-5%** returns from the endowment fund. The table below explains the actual benefits for your income range:

*Endowment returns are not guaranteed and calculated at the lower range of 4% for illustration.

** Based on historical returns from Endowment policies.

Salary Range	Tax Relief	Total Returns
$40,000 - $80,000	7%	11%
$80,000 - $120,000	11.5%	15.%
$120,000 - $160,000	15%	19%
$160,000 - $200,000	17%	21%
$200,000 - $320,000	18%	22%
$320,000 and above	20%	24%

Benefits:

• Capital Guarantee at the end of the policy period.
• Discipline of forced savings and tax relief makes it extremely compelling. Even for someone earning $60,000, it provides a return of more than 10% in S$ terms.
• Singapore has been one of the appreciating currencies globally in the last decade. When compared to currencies like Indian Rupee, the Singapore $ has appreciated by more than 50% in just the last 5 years.
• Smoothening of bonuses evens out bad years in the market ensuring a stable return during all years.
• The policy period is an extremely attractive option for children’s education and retirement corpus.
• Protection for Life and optional cheaper rider for major illnesses

Limitations:

• The maximum limit for tax relief is only $5,000.

FAQs/Concerns

Are these policies covered globally?

Yes, the protection for Life and Major illnesses are covered globally. In the event of you moving to work in another country, the policy will still provide you these benefits.

What will happen to the tax reliefs if am not working in Singapore?

The tax relief is applicable only till the time you have taxable earnings in Singapore. The policy returns 4% outside of the tax relief which is closer to the average returns from most Equity funds over the last decade.

Does it require fixed commitments of $5,000 and for how long?

 Yes – If you would like to use your tax relief primarily for investment options with Life insurance as bonus, it would require a fixed commitment for 12 years.

Call @ +65 8113 3272 for a free consultation.