What a gut-wrenching ride. SIAEC share price staged an impressive come-back as it surged from a low of $1.50 on 23 March 2020 to the current $2.20. The uptick in SIAEC share price represented a whopping 46% increase. Is it the right time for parent company, Singapore Airlines (SIA), to launch a privatization of SIAEC?
The major catalyst for SIAEC share price is the potential privatization by SIA. Rumour of privatization had been ongoing for several years as SIA CEO Goh Choon Phong aggressively consolidated SIA’s portfolio assets in a bid to rationalize cost and create synergy among the Group entities. The consolidation effort saw SIA Cargo and SilkAir being integrated into SIA while Scoot and Tigerair merged. SIAEC could be the next integration initiative following the massive rights issue of SIA.
SIA currently holds 77.4% of SIAEC shares. When the SIAEC share price plunged to $1.50 on 23 March 2020, the Price/Book Value was at a very attractive level of 1.05. At that point of time, it would make sense for SIA to privatize the MRO company.Read more