Olam

[winston]

Not vested. From DBS:-

Olam’s 3Q08 earnings were slightly above expectations, rising by 39% yoy to S$56m on revenue growth of 52% yoy to S$2.4bn.

Olam continues to execute well on its expansion strategy and deliver on earnings growth.

We reiterate BUY call and target price of S$3.80.

[winston]

Capital Group sold 1,991,051 OLAM shares, reducing holding to 101.2 mln shares.

[iam802]

Olam buys into Ivory Coast cotton sector

http://www.reuters.com/article/rbssCons ... 9620080603
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By Loucumane Coulibaly

ABIDJAN, June 3 (Reuters) - Singapore's Olam International Ltd (OLAM.SI: Quote, Profile, Research) has bought a major stake in Ivory Coast's cotton sector by purchasing the assets of bankrupt cotton producer La Compagnie Cotonniere Ivoirienne (LCCI).

The Ivorian state sold the LCCI assets to Olam for just over 8 billion CFA francs ($19.02 million), according to an official legal notice published this week in the government daily Fraternite Matin.

The West African country's cotton sector is struggling to get back on its feet after a 2002/2003 civil war in which the country's northern half, where cotton is grown, was seized by rebels. A national reunification process agreed in a March 2007 peace deal has set presidential elections for Nov. 30.

The assets acquired by Olam consist of around 100,000 hectares of cotton fields, cultivated by around 50,000 growers, and four ginning plants located in the north of Ivory Coast, according to cotton sector officials.

"We order the sale of the (LCCI) assets referred to in lots 1, 2, and 3 to to the Olam International Ltd company which presented the best technical and financial offer," said the notice from the Abidjan court which authorised the sale.

Ivorian cotton sector officials said they hoped the entry of a major international player like Olam, which supplies agricultural products to some of the world's top food firms, would provide a major boost to the northern cotton industry.

"The advantage is that it should allow the rehabilitation of the production system in the region," said Seydou Soro, head of the Intercoton association of cotton ginners and growers.

"Let's hope the growers can benefit from this when the Olam group starts its activities," he added.

Olam already has a subsidiary in Ivory Coast, Outspan Ivoire, which trades cocoa, coffee and cashew nuts in the world's No.1 cocoa grower.

Ivory Coast grew about 400,000 tonnes of cotton a year before the 2002/2003 war, but that conflict combined with low world prices, arrears owed to farmers by exporters and erratic rains have been hindering efforts to return to this level.

The country launched its 2008/2009 cotton crop last month with production expected to reach 250,000 tonnes, compared with 150,000 tonnes during the previous season, officials said.

In Ivory Coast's cotton areas, sowing starts in late May with the first rains arriving in June.

Late rains and low prices caused output to dip in 2007/2008, and exports of cotton totalled 77,982 tonnes from January to April 2008, down 12.3 percent on the same month last year.


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NOTE: OLAM was halted today as well.


(not vested)

[Musicwhiz]

I note that Olam is very aggressive in their acquisitions; considering they had 5 acquisitive deals in FY 2007 and now this one in FY 2008. My question is how they are going to fund these purchases (i.e. debt or equity) and are they earnings accretive to their current business ?

Also, any synergies between the new businesses and their current SCM one ? Just some thoughts.

Not vested.

[winston]

Not vested anymore.

Olam International Commodities firm Olam International said it has issued $300 million worth of convertible bonds.

[winston]

Not vested. From DBS:-

Olam’s long-term growth should continue to be within the agri-commodities space in non-perishable products, as the Group expands its reach, both in upstream sourcing and
downstream distribution, into adjacent products and geographies.

To help achieve these goals, we believe Olam will continue with its M&A strategy.

Maintain Buy; TP: S$ 3.51.

We believe that the current share price level represents an attractive entry level for long-term investors and that with the substantial funding recently raised, acquisitions should act as
catalysts for the stock to re-rate.

[millionairemind]

Olam To Acquire Dairy Trust For US$76.8m
Olam International announced that it will buy 24.99% of New Zealand’s Dairy Trust Limited (DTL) for US$76.8m. As part of the transaction, Olam will also secure a long-term marketing agreement for DTL’s product supply. DTL is the fastest-growing dairy processor in NZ and could become the second largest in the near future, Olam said. The dairy group expects to process over 450m litres of milk, and produce and export some 70,000 tonnes of dairy products this year. DTL could rake in revenue of around US$295.9m and a net profit of US$9.8m for the financial year ending July 2009.

[winston]

Not vested.

OLAM INTERNATIONAL - Merrill Lynch has upgraded its investment rating on Olam International to "neutral" from "under-perform" with a price target of S$2.60, citing earnings from acquisitions and an equity replacement improving gearing ratios.

[winston]

Not vested.

RPT-RESEARCH ALERT-CLSA starts Olam coverage with "sell" rating

SINGAPORE, Aug 20 (Reuters) - CLSA has initiated coverage of commodities company Olam with a "sell" rating and a target price of S$1.61, citing the company's limited prospects for volume growth.

"Olam occupies leading market-share positions for most of its large volume generators including coffee, cocoa, rice and sugar," said CLSA analyst Thilan Wickramasinghe in a note on Wednesday.

"These commodities are showing limited year-on-year consumption growth and supply is highly fragmented making meaningful volume growth expensive," Wickramasinghe said.

Shares of Olam closed at S$2.13 on Monday.

[helios]

any short sellers?




- Weekly chart reviewed on 26-Aug'08.