Wednesday, March 07, 2012

Dijacor marked down by Related Parties Transactions

Dijacor announced that it will be acquiring 73 properties from its major shareholder, Danny Tan for RM948.7 million or at a discount of 16% to the market valuation of RM1.1 billion (for more, go here). Despite the hefty discount, the market showed its displeasure to this type of related parties transaction by selling off the stock. Dijacor dropped 18 sen to RM1.49 today. This means that the stock has broken below its horizontal support at RM1.55. It may find support at the psychological RM1.50 level or at the next horizontal line at RM1.44.

Chart: Dijacor's daily chart as at March 7, 2012 (Source: Quickcharts)


flow with the Tao said...

Any related party transaction especially acquiring assets from directors or subatantial shareholders would of course raise eyebrows.In this case RM948 million is a huge amount and why should Danny Tan want to dispose to Dijaya if he could make more money by acquiring them for himself in the first place?? Maybe he wants to set up a foundation like his brother!!


Mad Investor said...

List of Properties also too vague. only geran # disclosed. Land size, FH/LH, market value all not revealed in announcement.