The Motley Fool

The Week in Numbers: EU and Britain Agree Brexit Extension

Leaders of the 27 countries remaining in the European Union (EU) have agreed to extend Britain’s date of departure from the EU to 31 October. That is four months longer than what British Prime Minister Theresa May asked for. The extension gives May six months to secure parliamentary backing for her Brexit treaty.

In return for extending the Brexit deadline beyond June, May has agreed to organise British elections to the European parliament. However, Britain could still secure a deal and leave before Britons would have to vote in the May 23-26 election to the European Parliament.

The International Monetary Fund cut its outlook for global growth for the third time since October 2018. IMF said the global economy is likely to grow 3.3%, the slowest pace in a decade, since the global financial crisis. The forecast was cut by 0.2% from its January outlook.

Analysts in Singapore have said the downgrade is unlikely to impact Singapore’s growth forecast. Forecasters have estimated a gross domestic product growth of 2.5% for this year, down from 3.2% in 2018.

Meanwhile, Hyflux Ltd (SGX: 600) has said it will talk with creditors to explore outcomes other than liquidation. Last Thursday, Hyflux terminated a white knight acquisition deal from SM Investments. The deal was killed after SM Investments failed to show commitment to its earlier agreement to inject S$530 million into Hyflux. Retail investors of the perpetuities are still left in limbo as to what options are available for them.

Uber Technologies Inc said that it will seek to raise around US$10 billion worth of stock in its initial public offering (IPO). An IPO raising that much would make it the biggest technology IPO of all time, and the largest since Alibaba Group Holding Ltd went public five years ago.

Uber is said to be seeking a valuation of between US$90 billion and US$100 billion. Uber was valued at US$76 billion in the latest round of private fundraising. Most shares sold would be new shares issued by the company, while a smaller portion would be from Uber investors cashing out. Uber operates in more than 70 countries and also has a 27.5% stake in Grab. Uber had US$11.3 billion in revenue last year but lost US$3.3 billion from operations.

Besides Uber, another high profile internet company, Pinterest Inc, also plans to go public this year. It set a price range for its IPO that values it slightly below US$12 billion, a figure at which it was valued at its last private fundraising in 2017. The online inspiration boards website is offering 75 million shares for US$15 to US$17 each. In total, Pinterest wants to raise US$1.28 billion. Pinterest earned about US$756 million in revenue from online advertising in 2018, a 60% increase from the prior year. Its net loss shrank from US$130 million in 2017 to US$63 million in 2018.

Meanwhile, Grab aims to raise another US$2 billion this year. The announcement by the chief executive, Anthony Tan, came just weeks after announcing over US$4.5 billion of funding. Grab is hoping to become an “app-for-everything” in Southeast Asia. Tan said:

“We basically received a very strong vote of confidence. And Masa (Masayoshi Son, CEO of SoftBank Group) shared that SoftBank is very happy with Grab and that SoftBank will provide unlimited support to power our growth.”

According to The Straits Times, people with direct knowledge said that Grab has raised about US$8 billion since it launched some seven years ago.

Maximise dividends on your REITs with our brand-new Complete Guide To Buying The Best Singapore REITs. We reveal everything we think you need to know about finding the best REITs that hands you a fat dividend cheque...even if you have noREITs experience at all! Get instant access to your 100% FREE, actionable, 42-page PDF guide here.

The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Jeremy Chia own shares in Alibaba Group Holdings Ltd.