The recent press release by First REIT (on 18th May 2022) with regard to its disposal of Siloam Hospitals Surabaya ("SHS") is mind boggling. First and foremost, the press release talked about the original cost of acquisition of SHS was just
S$16.8Mil in 2006 and hence the selling price of
S$40.9Mil translates to a huge capital gain of over 143.2%. However, when one opened up the SGX announcement, it revealed a shocking loss of
<S$0.6Mil> upon the disposal of SHS. There appears to be 2 completely contradictory statements being made. What exactly is going on here?
- Press release emphasis on 143.2% gain since initial purchase at S$16.8Mil.
The press release only reported impressive capital gain of 143.2% but strangely it did not have a single word pointing to the "loss on disposal" expected from this deal.
- Fair valuation of SHS (S$40.9Mil) as at 31 Dec 2021 is already the same as the announced selling price
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