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OUE, OUE Hospitality Trust slip as Mandarin Orchard Singapore faces food poisoning probe
THE stock of hotel trust OUE Hospitality Trust and its sponsor, OUE, slipped on Wednesday after dozens of people were reported to have fallen ill after attending a wedding banquet at the Mandarin Orchard Singapore.
Singapore's National Environment Agency, Ministry of Health, Public Utilities Board, and Agri-food and Veterinary Authority are jointly investigating the incident, according to reports by The New Paper. Mandarin Orchard Singapore is a portfolio hotel of OUE Hospitality Trust.
The Trust's units closed at 68 Singapore cents on Wednesday, down by 2.2 per cent or 1.5 Singapore cents. OUE shares headed out at S$1.48, down 2.6 per cent or 4 Singapore cents. The Straits Times Index, the broad market benchmark, finished the day down 0.4 per cent at 3,155.92.
RHB analyst Vijay Natarajan told the Business Times that the food poisoning news and the weak overall market may have put pressure on OUE Hospitality Trust's stock price. He said that ongoing investigations may mean that it could be a few days before investors can get more clarity on the matter. Further regulatory action could put more pressure on the stock price.
For now, however, the risk for the stock is "mainly reputational risk that could potentially arise from the incident, as Mandarin Orchard is one of Singapore’s top-tier hotels," he said.