Friday, October 10, 2008

Daily news - 9 Oct

Venture shares plunge to 10-year low
Venture Corp – The electronics maker that holds $118.6m of collateralised debt obligations, tumbled to the lowest in 10 years in Singapore trading on concern that it would book more losses from investments. The stock has fallen over 55% this year, compared with a 40% decline for the benchmark Straits Times Index. Venture closed yesterday at $5.30, down 15.7%. Singapore's largest electronics maker may incur more losses from its CDO investment and write down the value of its 20.7% stake in DMX Technologies Group Ltd, according to Shailesh Jaitly and Chitra Gopal, analysts at Nomura Holdings Inc. There are 'hidden gremlins' in Venture's balance sheet, the analysts wrote in a report on Tuesday. The company may book losses of $25m for the third quarter and $10m for the three months ending Dec 31 from its CDO investment, the Singapore-based analysts said. Chua Mun Yuen, a spokeswoman at Venture, could not immediately be reached for comment. Venture's stake in Hong Kong-based DMX, which it acquired for $82.45m in 2006, is now worth about $18.6m, indicating that the electronics maker may have to write down its value, the analysts said.

Banyan Tree hopeful of villas launch
Banyan Tree Holdings – Is holding its breath in the hope that the carnage in financial markets will not stop the rich from buying its luxury villas. Ahead of the weekend launch of 70 villas in five locations, Banyan Tree group managing director Ariel Vera said people are looking for alternatives, simple investments. He said Banyan Tree did consider cancelling its roadshow but decided to proceed to gauge the response. He said many investors have cashed out of markets and by buying a villa, they 'can enjoy their investment at least'. The villas to be launched at the weekend cost from US$600,000 to US$4m. And people who buy at the launch will get a 3% discount, up from 2% given last year. The stockmarket rout is serious, Mr Vera said. But Banyan Tree sold more villas in the first half of this year - 'when Bear Stearns had already happened' - than last year. He said Banyan’s hotel reservations for September to December this year would be similar to last year's levels.

Source: Kim Eng

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