SPH shares soar 22% on heavy volumes on restructuring talk

Singapore

AS RESTRUCTURING rumours swirled, shares of Singapore Press Holdings (SPH) shot up on Friday in active trading, prompting a query from the bourse operator.

They kept up a rapid ascent right after the opening bell, hitting an intraday high of S$1.28 - up 22 per cent or S$0.23 from the previous close in the final hour of trading.

This was also a four-month high; the last time the counter closed at this level was in early July.

The stock ended at S$1.25 on a cum-dividend basis, a jump of 19.1 per cent or S$0.20 on the day.

Some 85.6 million shares changed hands, making it the second-most traded by value on the Singapore bourse, and sixth by volume.

That represented over 5 per cent of SPH's issued and paid-up shares. The Newspaper and Printing Presses Act has, since 2002, barred any person from owning 5 per cent or more of a newspaper company without the approval of the Minister for Communications and Information.

About 110 large trades, each valued at more than S$150,000, were done during the day, Shareinvestor data showed.

The counter had begun inching up this week. Between Monday and Thursday, it rose about 4 per cent or S$0.04 from last Friday's closing price of S$1.01.

In a note on Friday, OCBC pointed out that the stock's volumes by 10.18 am had already exceeded 12 times of the 20-day average for that time of the day.

There has been "market talk of some imminent corporate restructuring news around the corner", said OCBC, which stressed that it was unable to verify the accuracy of the source.

At 1.56 pm, the Singapore Exchange (SGX) asked SPH whether it had a possible explanation for the unusual price and volume movements.

If there was any information not previously announced concerning the group that might explain the trading, SPH should announce it immediately, SGX said.

SPH replied at 3.38 pm that it "regularly evaluates all opportunities across its portfolio with the objective of enhancing shareholder value, which may from time to time involve discussions with various parties and stakeholders".

It added that there was no assurance that any transaction would materialise or that any definitive or binding agreement would be reached.

A brokerage suggested to its clients on Friday that investors could watch for potential share buybacks or issuances; it said that the recent news flows appeared linked to the upcoming AGM on Nov 27.

Meanwhile, on Wednesday, UOB Kay Hian (UOBKH) had written: "The stock could have bottomed as there is divergence warning from the MACD (moving average convergence/divergence) that hints of a potential low.

"A bullish conversion and baseline crossover are likely. The overhead cloud resistance is relatively thin, hinting that prices could break through the cloud more easily." These could increase the chances of the stock price moving higher, it added.

UOBKH on Wednesday had said that the potential upside target was S$1.17. Its institutional research team had a "hold" call and target price of S$1.12 at the time.

Last month, the stock briefly dipped below S$1. The first time it did so was on the morning of Oct 14, after the board slashed dividends as the media and property group fell into the red; it fell again on Oct 29 to Nov 2, to close at around S$0.99 to S$0.995.

SPH, which publishes The Business Times, recommended a final cash dividend of one Singapore cent per share for its fiscal year ended Aug 31, down from 5.5 cents a year ago.

The dividend is payable on Dec 18 after books closure on Dec 4.

Separately, the manager of SPH Reit, which is sponsored by SPH, announced on Wednesday that its non-executive director David Chia has quit to pave the way for the "renewal of board members".

SPH Reit units rose on Friday, up 1.9 per cent or 1.5 Singapore cents to 81.5 cents.