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According to a Nomura Research report today, Genting Hong Kong, which is 19.3% owned by Genting Malaysia, could be given out as dividend-in-specie to Genting Malaysia shareholders.

Just to recap: Genting Singapore sold Genting UK to Genting Malaysia for the equivalent of $688.8 million. Now, after the 102% surge in Genting Hong Kong’s share price year-to-date, Genting Malaysia may want to cash out, Nomura reasons. “We believe the time is ripe for Genting Malaysia to monetise its 19.3% investment in Genting Hong Kong currently classified as available-for-sale financial assets in the balance sheet which is worth RM2.4 billion ($1.03 billion) at current market value. To detach itself from Genting Hong Kong, one quick option is to dividend its shares in specie to all shareholders ahead of its foray into the tightly regulated casino industry in the US, in our view,” the report states.

The other option would be for Genting Malaysia to shunt its Genting Hong Kong stake to Genting Singapore, but this is less likely. Whichever way, selling pressure on Genting Singapore and Hong Kong could persist in the coming week.

1 comments

Understanding Investment Banking said... @ October 1, 2010 at 4:38 PM

Hi
I would say this is what business is all about keep merging companies and make the profit of them but one cannot sure about when the merger company will give profit.

Stuart

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