APAC Realty Launched IPO for SGX Mainboard Listing (Again)

APAC Realty IPO

APAC Realty has launched its IPO to gather about S$2.9mil by offering about 4.4 million shares at S$0.66 each.

According to the APAC Realty’s IPO Prospectus logged with MAS here, The core business of APAC Realty is its property brokerage business under the ERA brand. The proceed of S$2.9mil from the IPO will be used for the following

  • For strengthening and expanding our presence in Singapore ( S$10mil )
  • For expanding our range of services and geographical presence in the Asia-Pacific region ( S$10mil )
  • For enhancing our technological capabilities ( S$5mil )
  • For general corporate and working capital purposes ( S$2mil )
  • For payment of underwriting commissions and offering expenses ( S$2.1mil ).

 

Media reported the IPO as a ‘re-listing’ of ERA group at SGX. Out of curiosity, SGX Observer tried digging info about the predecessor, Hersing Realty Limited.

Hersing Corporation Limited (SGX:H28)

Hersing Realty launched its IPO in year 1998. Priced at S$0.36, 21 million shares was offered and gathered S$5.9mil. (APAC Realty IPO is 7x bigger compared to Hersing 20 years ago)

According to Hersing Realty’s prospects then,

  1. approximately $3.0 million to satisfy part of the purchase price for the office space to be used as its headquarters;
  2. approximately $1.0 million to satisfy part of the purchase price for two retail units at strategic locations;
  3. approximately $1.0 million to expand its retail network in Hong Kong; and
  4. the balance of approximately $0.9 for working capital.

 

Hersing Corporation was subsequently privatised and de-listed in year 2012, with the offer at S$0.23 per share, which is about 6% above the trailing 12 months volume weighted average share price then.

According to the information still available at SGX website, there were 3 bonus issues through out the 13 years of listing.

Company NameTypeEx-DateRecord DateDate Paid/PayableParticulars
HERSING CORPORATION LTD,BONUS16 Jun 200818 Jun 200826 Jun 2008OFFER OF 1 FOR 1
HERSING CORPORATION LTD,BONUS12 Apr 200716 Apr 2007,OFFER OF 1 FOR 2
HERSING CORPORATION LTDBONUS01 Nov 199905 Nov 1999,OFFER OF 1 FOR 2

 

Hence, if one holds the share since IPO till its delisting, with the basic calculation of implied cost of S$0.23 x 67% x 67% x 50% = S$0.051 per share, vs the final offer price of $0.230 per share, the return is 400% if one kept holding the shares for 13 years. Note that this is without considering the return of dividends issued.

Hersing Corporation SGX:H28 Historical Share Price
Hersing Corporation SGX:H28 Historical Share Price

 

SGX Observer only managed to dig out the share price data early as year 2004, and hence can’t really tell how did the share price performed for the 5 years period from 1998 to 2003. Note the share price shown in chart is the actual share price without adjustment. The few sharp falls in price were the result of bonus issues mentioned above.

Compared against the benchmark Straits Times Index, 400% should be quite a good return rate for holding a stock for 12 years?

 

Nevertheless, APAC Realty is not the same as Hersing Corp. Even if they were the same, past performance of share price is not indicative for the future performance. Hence, these information is purely meant to satisfy SGX Observer’s personal curiosity.

 

 

 

 

 

 

 

 

 

 

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