Monday 8 December 2014

IOI Wants 101

If I am a major owner of IOI, I will dream of buying Taipei 101, just because of its name.

If I am a minor shareholder of IOI, I will definitely welcome the idea of buying Taipei 101, as long as the deal is fair.

IOI Properties is going to buy 37.1% of the skyscraper from Ting Hsin Int Corp for RM2.74bil or NT25.14bil, subject to Taiwan authority's approval.

IOI Properties will have second largest stake in Taipei 101 after Taiwan government-invested ventures at 44.35%.

Ting Hsin is involved in several food safety scandals in Taiwan and was somehow forced to sell its stake in Taipei 101 due to its negative image on the landmark building.

Ting Hsin bought its stake about 5 years ago for just about NT8bil. Now it is going to sell at NT25bil. The rich just gets richer.

Taipei 101 has a net book value of NT39.6bil as at 31 Dec 2013. It is 96% occupied and its gross rental yield is reported to be >5%.

Is it a good deal? Is IOI paying too much? I'm not sure.

Anyway, owning world's famous landmark building is always a good idea for me.

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