Oxley announced it bought United Engineers shares. 7% stake, which is likely to cause the current Offer from Yanlord to fail because Oxley (& perhaps friendly parties) ain't subscribing for it and so Yanlord cannot do compulsory acquisition. .
Bought at $2.654 cents a share, no wonder trading price has been higher than offfer price of 2.60.
The question is , what does Oxley intend to do with its stake?
1. Singapore property sentiment has turned positive and who has the largest residential landbank today? Oxley! It bought the landbank this year, which is great timing. Can build 2,833 units (S$3.03b GDV).
2. Royal Wharf project (London) has hardly any default despite Brexit. The deliveries are accelerating and cashflows will be awesome.
3. Oxley's 2 hotels in Stevens Road, Singapore, have been completed. They should open soon!
Novotel opened in Oct 2017.
Mercure opened over the past weekend.
Room rate SGD155, looks like it's priced to sell in volume. Location is not near MRT station but can walk to Scotts Rd and Orchard Rd.
Expected weakness in Oxley share price because people who took placement shares selling their holding ahead of the receipt of the placement shares.
Short term.
The fund raising of $78 m is good for Oxley to cheong some more. Perhaps it is for the upcoming Myanmar Central Yangon Railway project. A monster project. 25.7 hectares, equivalent to about 35 football fields.
Big feather in the cap, already got lovely feather from London project (Royal Wharf).
