Friday, 3 August 2018

RHT - Religare Health Trust Deal

Finally, I disposed off my holding in Religare Health Trust after I made some calculation.

Initial estimate distribution announced in early this February
  1. Final INR for consideration of INR46,000 millions. (It is suppose to be INR46,500 millions however there is a clause in the deal that reserve this INR500 millions if  parties not obtaining warranty and indemnity clause)
  2. Total outstanding shares was about 807,842,000
  3. Exchange rate INR48.5=SGD1
Based on the above, we will be able to derive why they mentioned net consideration is $0.88 (INR46,000 millions divided by INR 48.5 and divided by the total outstanding shares)

However the manager also mentioned the transaction cost of $15.8 millions with this the net proceed will be $0.86 and the manager reserve 5% and with this the estimated distributed will drop to $0.82.

Few months has passed and few thing has changes
  1. No of outstanding shares has increased to 809,644,000
    • Remember, there is another quarter in September that will increase the outstanding shares however for those still holding you should be able to get some additional dividend :)
  2. INR exchange rate has depreciate to around INR50 = SGD1 (as of 3 Aug 18)
With those 2 new figures , the estimate distribution will be $0.8 and with manager reserve 5%, the distributed amount somewhere in year end will be $0.78.

With a lot of uncertainty, even IHH has made the offer and Fortis has accept it then come Daiichi , you can read the news here . I have decided to say good bye to RHT since I don't see much capital gain I can have.

RHT is a painful lesson for me even though I don't suffer any capital loss and still keep the dividend over the year. I could have earn much more capital gain if I could did my due dilligence earlier instead of at this stage.

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