Indonesia's Cardig soars as Singapore airport operator buys
Bareksa • 21 Feb 2014
Workers stand near a Citilink airplane covered with ash from Mount Kelud at Adi Sucipto airport in Yogyakarta (REUTERS/Dwi Oblo)
SATS offered S$0.14 per share, equal to 1,275 rupiah per share at current exchange rates
Reuters - Shares of Indonesian airport servicing firm Cardig Aero Services rose as much as 17 percent, hitting an all-time high on Friday after Singapore Airport Terminal Services Ltd (SATS) said it has acquired about 42 percent of Cardig.
Subsidiaries of SATS, which manages Singapore's Changi airport, will purchase 869.2 million shares in Cardig for S$118.3 million ($93.5 million), SATS said in a Singapore stock exchange filing late on Thursday.
Analysts said the investment by a major regional airport services firm would boost resources at Cardig, which provides cargo and baggage handling services at Indonesian airports including Jakarta.
SATS offered S$0.14 per share, equal to 1,275 rupiah per share at current exchange rates - a premium of 38 percent to Cardig's close price on Thursday of 925 rupiah.
At 0515 GMT Cardig's shares were trading 13.5 percent higher at 1,050 rupiah while the broader Jakarta index was up 0.72 percent. Shares in Singapore-listed SATS rose as much as 1.7 percent to S$3.060.
Jakarta-based Bahana Securities said in a note issued after the SATS filing that it has raised its target price for Cardig to 1,170 rupiah from 1,010 rupiah, maintaining its 'buy' rating on the stock.
"Given that SATS is one of the largest airport services providers, we believe its presence would improve Cardig's corporate governance and at the same time, provide technical know-how for the company," said Aditya Eka Prakasa, aviation analyst at Bahana, in a note on Friday. ($1 = 1.2648 Singapore dollars)