Genting Malaysia, Genting rally after news of likely Miami property sales

KUALA LUMPUR: Genting Bhd and Genting Malaysia Bhd's shares rallied in early trade Monday on a possible exit from the Miami property market with big gains.

At 10.05 am, Genting and Genting Malaysia grew six sen to RM4.56 and five sen to RM2.60 respectively.

Maybank Investment Bank Bhd said that more than a decade after entering the Miami property market, Genting Malaysia is likely to exit it but with a whopping profit in tow.

The company could recognise a gain on disposal of about RM2.9 billion, assuming the waterfront is sold for US$1 billion.

"Yet, we do not expect Genting Malaysia to declare special dividends,” it said in a note today.

It was reported that Genting Malaysia’s property in Miami, Florida has attracted five offers, with the highest bid being just under US$1.5 billion.

Genting Malaysia plans to make a final decision in the coming weeks.

"Recall that Genting Malaysia had invested US$500 million throughout May and September 2011 to acquire the aforesaid property. Note that the ringgit was trading at only RM3.00:US$1 then versus RM4.43:US$1 currently,” it noted.

Maybank Investment said it was maintaining earnings estimates, a buy call, and a RM2.97 target price on Genting Malaysia pending the finalisation of the property sale. - Bernama

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