Sakae

Sakae: announces material info concerning its 24.7% stake in associate, Griffin Real Estate Investment Holdings (GREIH). CEO Douglas Foo recently ordered an Accountants’ Report on GREIH, to inspect the accounting records and report on its financial affairs, arising from concerns over certain transactions undertaken at GREIH. These incl payments of substantial sums of monies that have been made by GREIH and apparent contracts which purport to oblige GREIH to make substantial payments to companies related to senior mgt of GREIH that had not been properly disclosed to the co. The Board has notified the Commercial Affairs Dept and also reported the matter to the Minister for Finance. The co will continue to monitor the situation and evaluate the recoverability of its invmts in GREIH, as well as any arising impairment losses. The investment in GREIH is not insignificant. Sakae carries GREIH at a net book value of $10m. It had invested a combined $6.6m in the unit. This compares with Sakae's sh/h equity of $28.2m, as at end 1H12. Prior to this incident, the counter was on an upward march to new multi-year highs. It is now trading at $0.315, -8.7%. Sakae currently has a market cap of $44.7m, trades at 6.9x trailing P/E, 1.6x P/B.