Addvalue should rethink value-unlocking move
The business it plans to spin off may garner a lofty valuation on Nasdaq, but its own shares may be plagued by a holding company discount
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[SINGAPORE] When Addvalue Technologies said on Mar 13 that it had formed a working team to realise the full potential of its Inter-Satellite Data Relay System (IDRS) business, it appeared to be embracing the shareholder value-focused mindset that the Monetary Authority of Singapore (MAS) and the Singapore Exchange (SGX) have been trying to encourage through their Value Unlock programme.
It was not long before the working team came up with an actual plan. Before the market opened last Monday (Apr 27), the satellite communications and wireless connectivity group said an application had been submitted to SGX on a proposed spinoff and listing of its IDRS business on Nasdaq.
Addvalue said that it intends to maintain a 51 per cent stake at least in the separately listed unit, and that SGX had concurred with its view that the move would not amount to a chain listing.
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