Say NO to Cosco Shipping buyout offer and demand for better!
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We agree with Philip Securities Research analyst Richard Leow’s statement in the 4/11/2017 Straits Times that the offer is “much lower” on a price-to-earnings (P/E) basis that the recent buyout offer for another company with similar business - Poh Tiong Choon Logistics.
Based on Cogent’s half year reported profits ended 30 June 2017 of S$20.156 million and multiply by 2 for full year results, estimated profits should be S$40.312 million. Even using a lower P/E of 20 (not 23 as used in the Poh Tiong Choon’s buyout offer), the buyout offer by Cosco should be S$1.68 per share based on outstanding shares of 478.5 million. If we use the buyout offer of P/E 25, the buyout offer should be S$2.11 per share. Thus, on average and with the expectations that Cogent’s near term results should be better based on Cogent’s Jurong Island Chemical Logistics Facility coming onstream, shareholders should be paid S$1.89 per share. As minority shareholders, we may have been shortchanged by 87 cents (S$1.89 – S$1.02).
We appeal to all Cogent minority shareholders to reject the buyout offer and fight for your rights to a better offer!
Please contact me at firstname.lastname@example.org with your name, contact details and number of Cogent shares owned if you wish to fight for a better price.
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