HNA offers to buy Singaporean logistics firm CWT for S$1.4 billion
The offer illustrates Chinese companies believe industrial commodity prices will trend higher, analysts say
The Singapore listed shares of logistics and commodity firm CWT Group rose 10 per cent to a one-year-high on Monday after Chinese conglomerate HNA Holdings offered to buy the company for S$1.4 billion (US$1 billion) on Sunday.
CWT traded at S$2.28 (US$1.62) per share during the morning session, up 10 per cent from its previous close on April 5.
HNA in Hong Kong was up 1.5 per cent to 34 HK cents.
“The deal is sensible as CWT is a global company with logistics and commodities trading. This would help HNA to expand into the logistics and commodities trading business in the international market,” said Jasper Lo Cho-yan, chief strategist at King International Financial Holdings. “Chinese companies are positive on the commodity price and outlook.”
Lo said it’s widely believed that US president Donald Trump will follow through on plans for infrastructure rebuilding projects, which will bolster demand for industrial commodities.
“In addition, the ‘One Belt, One Road’ initiative by China would also result in more infrastructure projects in the countries along the route. This would also push commodities prices up,” he said.