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Why Has The Share Price Of This Company Doubled In 3 Months?

With the property industry in a slowdown this year, prices of related companies have been depressed and we have seen a number of mergers and acquisitions in the market as a result. One of the latest to join the line would be LCD Global Investments (SGX: L38), which is now involved in a possible shareholders’ battle.

LCD Global is a property developer and owner with business interests around the globe. It has completed development projects in Singapore, Malaysia and China and also runs hotels in London and Phuket, Thailand. This April, major shareholders David and Raymond Lum, more commonly associated with their holding company, Lum Chang (SGX: L19), offered S$0.17 per share to take LCD Global private. The Lum family has a strong connection with LCD Global with a combined 30% stake in the company. In addition, David Lum’s son, Kelvin Lum, is currently the managing director of LCD Global.

Since then however, Koh Wee Seng, the chief executive of Aspial Corporation (SGX: A30), has been aggressively buying up shares of LCD Global, pushing his stake in the company to slightly less than 15%. His actions have hinted that the privatisation deal will most likely not be able to go through, especially now that LCD Global’s shares have more than doubled from S$0.14 in mid-March to S$0.31 today.

With the emergence of Koh as a shareholder with a significant stake in LCD Global, there’s a possibility that a rival bid might appear for the company. So far, there has been no change in the takeover offer that was put forward by David and Raymond Lum.

Foolish Summary

Koh has strategic investments in a number of other listed companies as well; he has interests in the pawnbroker Maxi-cash Financial Services (SGX: 5UF) and real estate and construction outfit TA Corporation (SGX: PA3).

It remains to be seen if Koh would hold on to LCD Global as another strategic investment in his portfolio. One thing’s for sure though – minority investors in LCD Global would have been quite happy with those gains over the past three months.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Stanley Lim doesn’t own shares in any companies mentioned.