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Coffeeshop Chit Chat - Temasek taking money out from SATS</TD><TD id=msgunetc noWrap align=right>
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</NOBR> </TD><TD class=msgDate noWrap align=right width="30%">7:14 am </TD></TR><TR class=msghead><TD class=msgT noWrap align=right width="1%" height=20>To: </TD><TD class=msgTname noWrap width="68%">ALL <NOBR></NOBR></TD><TD class=msgNum noWrap align=right> (1 of 1) </TD></TR></TBODY></TABLE></TD></TR><TR><TD class=msgleft width="1%" rowSpan=4> </TD><TD class=wintiny noWrap align=right>3276.1 </TD></TR><TR><TD height=8></TD></TR><TR><TD class=msgtxt>SATS to buy 70% stake in Singapore Food Industries
By Desmond Wong, Channel NewsAsia | Posted: 02 December 2008 1634 hrs
SINGAPORE: Singapore Airport Terminal Services (SATS) said on Tuesday it is buying nearly 70 per cent of Singapore Food Industries (SFI) for about S$335 million in cash.
SATS is paying 93 Singapore cents a share for the stake held by investment company Temasek Holdings – a 4.5 per cent premium over SFI's last traded price on Monday of 89 cents.
In trade on Tuesday, SFI's shares rose 1.7 per cent to 90.5 cents at the mid-day close before trading was suspended. SATS will also make a mandatory takeover for the remaining shares of SFI at 93 cents each.
In a statement, SATS said the acquisition is in line with its long-term strategy to grow its businesses in airport and food services to enhance shareholder value.
It believes there are synergies in product development and production, as well as cross-selling opportunities between the two companies.
It said by expanding into the resilient consumer staples food business, it can mitigate its exposure to the aviation sector and reduce volatility in its earnings.
SATS, a unit of Singapore Airlines, said the acquisition is earnings accretive and will strengthen its cash generation abilities and improve the efficiency of its capital structure.
Clement Woon, president and CEO of SATS, said: "I think the food services leg of the business is an important one where we can expand into other market segments in Singapore, like hospital catering and event catering."
SFI is one of Singapore's largest integrated food services companies, with a wide spectrum of food-related businesses including food materials supplies, distribution and catering. It also has significant operations in the United Kingdom.
Once the deal is completed, 43 per cent of SATS' turnover will come from non-aviation food services.
Mr Woon said: "The aviation industry is of course very cyclical. From that point of view, it's currently in a down cycle. So for us to really create more stability in our earnings base, we would like to leverage on our competencies to go into a more stable market. The food market is one of those markets which are stable."
SATS is aiming to obtain shareholders' approval for the deal by January next year and hopes to make an offer for the rest of SFI in February.
[email protected]
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By Desmond Wong, Channel NewsAsia | Posted: 02 December 2008 1634 hrs
SINGAPORE: Singapore Airport Terminal Services (SATS) said on Tuesday it is buying nearly 70 per cent of Singapore Food Industries (SFI) for about S$335 million in cash.
SATS is paying 93 Singapore cents a share for the stake held by investment company Temasek Holdings – a 4.5 per cent premium over SFI's last traded price on Monday of 89 cents.
In trade on Tuesday, SFI's shares rose 1.7 per cent to 90.5 cents at the mid-day close before trading was suspended. SATS will also make a mandatory takeover for the remaining shares of SFI at 93 cents each.
In a statement, SATS said the acquisition is in line with its long-term strategy to grow its businesses in airport and food services to enhance shareholder value.
It believes there are synergies in product development and production, as well as cross-selling opportunities between the two companies.
It said by expanding into the resilient consumer staples food business, it can mitigate its exposure to the aviation sector and reduce volatility in its earnings.
SATS, a unit of Singapore Airlines, said the acquisition is earnings accretive and will strengthen its cash generation abilities and improve the efficiency of its capital structure.
Clement Woon, president and CEO of SATS, said: "I think the food services leg of the business is an important one where we can expand into other market segments in Singapore, like hospital catering and event catering."
SFI is one of Singapore's largest integrated food services companies, with a wide spectrum of food-related businesses including food materials supplies, distribution and catering. It also has significant operations in the United Kingdom.
Once the deal is completed, 43 per cent of SATS' turnover will come from non-aviation food services.
Mr Woon said: "The aviation industry is of course very cyclical. From that point of view, it's currently in a down cycle. So for us to really create more stability in our earnings base, we would like to leverage on our competencies to go into a more stable market. The food market is one of those markets which are stable."
SATS is aiming to obtain shareholders' approval for the deal by January next year and hopes to make an offer for the rest of SFI in February.
[email protected]
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