Wee Hur Holdings’ Shares Rally on Speculation
Wee Hur Holdings, a Singapore-based company, has seen a surge in its shares recently due to speculation surrounding the potential sale of its purpose-built student accommodation (PBSA) business in Australia. This surge was triggered by a report from the Australian Financial Review (AFR) suggesting that US multifamily fund Greystar was acquiring GIC’s PBSA business for a substantial amount.
The Background Story
- Wee Hur Holdings, led by executive chairman Goh Yew Lian and chief investment officer Goh Wee Ping, sold a 49.9% stake in its PBSA business to GIC in April 2022.
- Following the AFR report, Wee Hur issued a clarification stating that no significant transactions had taken place regarding these assets.
- The company did disclose that it is currently in early-stage discussions with a third party that may or may not lead to a transaction, emphasizing the uncertainty of the situation.
Market Response and Speculation
- Despite Wee Hur’s statement, the news has generated excitement in the market, leading to a 19.4% increase in the company’s stock price last week.
- Investors are unclear about whether the sale involves just GIC’s share or the entire PBSA portfolio, as well as the specific valuation of the deal.
Understanding the Numbers
Wee Hur Holdings has a storied history, starting as a general contractor in 1980 before expanding into property development and PBSA investments.
- In 2017, Wee Hur launched a fund to invest in PBSA in Australia, eventually selling a nearly 50% stake to GIC for over A$500 million.
- The current portfolio consists of 5,662 beds across seven student housing properties in key Australian cities.
- The recent revaluation of these properties has significantly increased the implied value per Wee Hur share.
In conclusion, the potential sale of Wee Hur’s PBSA business represents a significant development for the company and its shareholders. The precise details of the transaction remain uncertain, leading to market speculation and fluctuations in the company’s stock price. Investors and observers will be closely monitoring the situation to gauge the impact on Wee Hur Holdings’ future prospects and financial performance.