Wee Hur asset sale may see it declare special dividends

PhillipCapital surprised the market on Jan 3 by initiating coverage on Singapore-listed Wee Hur Holdings with a "buy" recommendation and a price target of 62 cents, substantially above the stock's closing price of 42 cents on Jan 2.

- Ven Sreenivasan

The report caught the market's attention for asserting the "strong likelihood" that Wee Hur may hand out special dividends following the company's announcement in December of the sale of its student accommodation assets in Australia for A$1.6 billion (S$1.37 billion) to real estate services provider Greystar. The seven-property purpose-built student accommodation (PBSA) portfolio, with more than 5,500 beds across key Australian cities, is 50.1 per cent owned by Wee Hur, with Singapore sovereign wealth fund GIC holding the remaining 49.9 per cent interest.

For its stake, Wee Hur will potentially rake in net proceeds amounting to $320 million in cash, pending shareholders' consent and regulatory approvals. The company, through a subsidiary, will hold a 13 per cent stake in the new ownership, worth A$208 million.