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stereo

有什么分别，还是一样可以私有化的啊！

Mr.Business

新闻。

Saturday September 27, 2008
Taking VADS private
By TEE LIN SAY

THE local bourse will soon have one less sound company with high dividend yield. This time, it’s VADS Bhd.

Telekom Malaysia Bhd announced plans to take VADS Bhd private at RM7.60 per share.

Since its debut on the second board of Bursa Malaysia back in August 2002, VADS’ share price has risen 10 fold (post bonus issue and transfer to main board) and about 13 times taking into account the dividend payout.

However, through much of the time, between its debut up to late 2005, the counter hovered around the RM1 level.

Shortly after VADS issued up to 10% of new shares to eligible executive directors and other key management, VADS’ share price has been appreciating steadily. It closed at its all time high of RM6.80 on the Friday prior to its day-long suspension to announce its privatisation.

Earnings wise, VADS can be deemed a dream stock. Revenue and net profit have been registering a compounded growth of 198% and 20% respectively since listing. For the six months to June 2008, revenue was up 11.59% to RM252.35mil, while net profit jumped 26.72% to RM27.69mil.

Street estimates are for the company to make RM66.1mil for the financial year. As of the period, it has a cash pile worth some RM129.13mil.

“Although contributing less than 10% of TM’s pro-forma net profit of RM748mil in 2006 and RM771mil in 2007, VADS’ net profit on its own, has more than doubled from RM21.2mil in 2005 to RM54.1mil in 2007,” says Aseambankers Research.

So, TM’s rationale for the privatisation? To give shareholders an opportunity to realise their investment in VADS at a premium.

“TM wishes to reaffirm that its intention to privatise VADS is essentially to allow the TM group to streamline its businesses to maximise potential synergies from both revenue growth and cost savings perspectives. There are opportunities and strengths within VADS and other parts of the group that can be harnessed together, and this is expected to improve the business and operational performance of the TM group,” says its group chief executive officer Datuk Zamzamzairani Mohd Isa.

The deal

TM, which owns 63.3% of VADS, is taking VADS private with a selective capital reduction and repayment exercise. This means that only shareholders other than TM will receive the payment.

TM is offering RM7.60 per share in cash for the privatisation, in an exercise that will involve a capital repayment to minorities, after a proposed bonus issue to allow the full capitalisation of VADS’ share premium account and part of its retained profits.

The exercise is expected to take some 6 months for completion.

VADS will carry out a bonus issue, with 706.2 million new shares which will boost its enlarged share capital to RM422.3mil comprising 844.6 million shares, after which it will cancel RM417.3mil, or 834.6 million shares.

As a result, its paid-up capital will be slashed to RM5mil comprising 10 million shares from RM65.9mil comprising 131.8 million shares currently.

After the RM417mil exercise, VADS will become wholly owned by TM.

To facilitate the deal, TM will get a wholly-owed subsidiary to provide an interest-free advance of up to RM417.3mil to VADS to fund the exercise.

CIMB Investment Bank Bhd will be arranging the deal.

Zamzamzairani says that TM intends to leverage on realising planned synergies to maximise its returns.

For example, he elaborates, “TM would like to be able to bring information and communications technology (ICT) products and services to market faster and more efficiently, be more focused in meeting customer needs, and be able to offer its customers, particularly in the Enterprise segment, a richer portfolio of ICT services in which TM believes is a key segment for the Malaysian economy.”

Go for it ...

Analysts are certainly not surprised by the privatisation, as talk of taking VADS private had been circulating in the market for months.

With liquidity constantly being a major issue for the stock, analysts have given the deal their nod.

The stock’s average fair value from six analysts compiled by Bloomberg stands at RM7.65.

The highest came from RHB Research, which is valuing VADS at RM8.51, while the lowest comes from Alliance Research, which has a fair value of RM7.

OSK Investment analyst Jeffrey Tan says the proposed privatisation price at RM7.60 per share, matches his target price for the stock, which values the company at 12 times financial year (FY) 2009 earnings per share (EPS).

Tan says VADS earnings are highly visible, thanks to strong recurring revenue from the managed network services (MNS) segment.

“The focus on the business process outsourcing (BPO) space unlocks a strong revenue stream and is expected to spearhead earnings growth going forward.”

Tan projects EPS growth at a healthy 25% on average per annum going into FY10.

He agrees that the privatisation will undoubtedly remove a jewel whose track record is difficult to emulate.

“We advise minorities to accept the offer as it is a good exit strategy to unlock the value of a stock that has been plagued by liquidity constraints and trading at an unwarranted discount to its global BPO peers,” he says.

Overall, Aseambankers views the privatisation as mildly positive for TM, as it allows VADS to consolidate its network service business and potentially create synergistic value enhancement.

Kenanga Research is positive on the deal, given the strong track record for the managed services and call centre division.

It believes that the consolidation and privatisation will enable VADS to divert more management attention and resources to the business which is expected to enter into a more exciting phase ahead.

Kenanga adds that financing should not be an issue given TM’s balance sheet strength, (which has a net gearing of 12%).

“We are maintaining our forecast for TM given the minor reduction in minority from the privatisation exercise. HOLD with target price of RM4,” says Kenanga Research.

Impact on TM

Meanwhile, with the completion of the privatisation, Aseambankers estimates the potential earnings impact to TM to be a small addition of 1.6% and 3.2% to its 2009 and 2010 net profit forecasts respectively.

Zamzamzairani says that, in view of TM already consolidating a significant proportion of VADS’ consolidated profits in proportion to TM’s holding in VADS, and that the privatisation is expected to be completed in the first half of 2009, the proposal is not expected to have a significant effect on TM’s earnings in the immediate future.

“Going forward, TM expects to capture synergies arising from the streamlining of the businesses within the TM group which as a result is expected to translate to higher earnings to the TM group in line with TM’s long term strategy for growth and efficiency,” he says.

Aseambankers says VADS’ core MNS and Systems Integration Services (SIS) both compete with various units within TM.

“As VADS secures more and more government-linked companies and government agency contracts, its continued growth is a threat to TM’s fully-owned divisions. Thus, privatising VADS could allow better shareholder returns for TM by consolidating these separate businesses under TM,” says Aseambankers.

“Our outlook for TM is strengthened as we view this move as much a defensive move (keeping in mind VADS competes with TM in certain areas), as a move to grow its bottom-line,” says Aseambankers.

Zamzamzairani points out that TM already holds 63.3% equity interest in VADS and hence, already directly benefits from VADS business.

Meanwhile, Aseambankers adds that with the advent rolling out of the national High Speed Broadband (HSBB) plan, there will be more growth opportunities for VADS, through which a privatisation will better allow TM to maximise potential returns.

However Zamzamzairani says taking VADS private is beneficial and independent of the HSBB.

“The privatisation of VADS and the HSBB plan complement each other well as both support TM’s vision of becoming a leading new generation telecommunications provider. Focusing on providing ICT services to its customer is a natural evolution for a telco like TM in view of the infrastructure that TM already has.”

The business model

VADS was established to provide MNS to multinational companies. Today, its business spans three sectors: MNS, which is its main revenue source, but it has since diversified into business process outsourcing (BPO) and system integration services (SIS).

Its MNS business provides local connections in Malaysia for global service providers. VADS also manages the wide area network (WAN) for companies, where it buys bandwidth from telco operators like Telekom and then manages the network for its customers for a fee.

Meanwhile, BPO is an important growth area for VADS moving forward. Revenue from this segment is mostly generated from call centre services.

The company aspires to be the largest call centre service provider in Asean and is looking to expand its services to South East Asia. Presently, Telekom is its main customer and makes up 50% of its revenue.

It provides call centres to deal with customer queries and complaints for Streamyx and TM Retail.

As for the SIS business, it is mainly project-based whereby VADS helps companies install and implement their server and storage system. Growth prospects are strong as more companies install new servers or replace old ones.

VADS is looking to increase the recurring revenue from this division through maintenance fees and the management of storage devices.

http://biz.thestar.com.my/bizwee ... 996&sec=bizweek

傻人最有傻福

Financial Results

Reference No VV-081103-63945

Company Name	:	VADS BERHAD
Stock Name	:	VADS
Date Announced	:	03/11/2008

Financial Year End	:	31/12/2008
Quarter	:	3
Quarterly report for the financial period ended	:	30/09/2008
The figures	:	have not been audited

Converted attachment :

Please attach the full Quarterly Report here:

傻人最有傻福

SUMMARY OF KEY FINANCIAL INFORMATION

30/09/2008

		INDIVIDUAL PERIOD	CUMULATIVE PERIOD
	CURRENT YEAR QUARTER	PRECEDING YEAR CORRESPONDING QUARTER	CURRENT YEAR TO DATE	PRECEDING YEAR CORRESPONDING PERIOD
		30/09/2008	30/09/2007	30/09/2008	30/09/2007
		RM'000	RM'000	RM'000	RM'000
1	Revenue	139,007	126,823	391,358	352,970
2	Profit/(loss) before tax	22,615	16,584	59,975	41,354
3	Profit/(loss) for the period	18,474	13,152	46,159	34,999
4	Profit/(loss) attributable to ordinary equity holders of the parent	18,474	13,152	46,159	34,999
5	Basic earnings/(loss) per share (sen)	14.02	10.38	35.37	27.74
6	Proposed/Declared dividend per share (sen)	0.00	0.00	12.00	17.00
		AS AT END OF CURRENT QUARTER		AS AT PRECEDING FINANCIAL YEAR END
7	Net assets per share attributable to ordinary equity holders of the parent (RM)	1.4600		1.3200

Note: For full text of the above announcement, please access Bursa Malaysia website at www.bursamalaysia.com

Remarks :

p98h

有那位大大可以告诉我到底VADS发生了什么事？这么一下子推低至3块多？

Genghiss

你有没有看错？７。４５啊

ThermoFisher

完成私有化
VADS19日除牌

（吉隆坡17日訊）私有化計劃完成，VADS（VADS，7150，主板貿易）將在本月19日正式除牌馬股。
VADS最后掛價7.55令吉。

去年9月間，馬電訊（TM，4863，主板貿易）宣佈透過資本削減和回退，以及4億1730萬令吉、或每股7.60令吉代價，私有化VADS。

7.60令吉的出價遭市場抨擊過低，券商更建議小股東在特大上投下反對票，無奈扭轉不了劣勢。

聯昌證券當時指出，VADS業務基本面穩固、收益成長強勁、股本回酬率穩定及抗跌力強，獻購價理應為8.10令吉。

興業研究說，獻購價相等于VADS的11.2倍本益比，但根據計算，本益比理應達到12.5倍。

stereo

班主可以删除此帖了。。

基金小子

谢谢VADS给我赚到钱。。。