Fraser & Neave (F & N)

[CityFarmer]

Well I do agree that it is also possible that they can consol and take private given they form a subsi IBHL maybe the vehicle for the assets they bought...

just something crazy up my mind, if we had examined the structure of FCL and Capitaland observe their business model, there seems to be strong similarity behind them (in terms of lines of business, geographical area and D/TC roughly 50%). If we were to continue on this line of thought and expolate.. Capitaland is trading at 0.80x its NAV (latest mkt close/BS NAV) ($3.02/3.74) and if we were to apply that discount to FCL which has a 1.88 NAV cost based on 12 Nov then a per lot FCL would be worth $1.50 if traded today. As 1 lot of FNN would yield 2 lots of FCL, that would bring FNN (post XD) to be worth $3 (assuming $6 - $3), that is means an implied PER of 10X while the rest of asia F&B stocks trade at levels near 20X (even FNN Malaysia is 21X) which means that could be potentially alot more upside in the CE-XE demerger trade. just some quick back of envelope calcs over kopi.

Base on the latest DIS presentation slides, which based on Jun 2013 financial data

The post-DIS FCL's per share NAV is $2.04, while F&N's per share NAV is $1.69

Ref: http://infopub.sgx.com/FileOpen/Investor...eID=254081