Privitasing Magnum will be a very good benefit for MPHB since they can enjoying the high dividend / special dividend pay out by Magnum.
Theedgedaily has mentioned on one things which is very interesting on last week the edge weekly:
Even though MPHB's share price has appreciated by 17% in the past two months, it appears that the stock is still undervalued. Based on MPHB's closing price last Wednesday of RM2.36 and 954.58 million MPHB shares issued, its market capitalisation is RM2.25 billion. Based on Magnum's closing price of RM3.02 last Wednesday, the market is valuing the company at RM4.37 billion. This means that MPHB's 55.54% stake in Magnum is worth RM2.41 billion, which is more than the market capitalisation of MPHB. This could be another reason investors are keen on MPHB shares — its market value is less than what its stake in Magnum is worth.
So, at that time, if you have purchase MPHB shares, that means you are purchasing all the shares in the magnum and for other business they have you will get for *free*. You are valuing MPHB other business / assets / property as *zero* value.
Lets take a look on the MPHB other business besides Magnum:
On year 2006, MPHB got 24.7 millions net profit from Gaming and leisure, property investment 11millions net profit , securities and broking and dealing 33millions net profit, financial services 25.2 millions and finally is Magnum 118.4 millions. After deducting the finance cost, the profit they earn besides Magnum is 76.2 millions.
So, market is valuing that 118.4 millions net profit but forgot about the 76.2millions net profit they earn from their own business.
Wow, let see what is the share price for MPHB and Magnum when they resume trading.
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