Rumours Why Gamuda Shares Is Moving Higher!

Makes you wonder why our financial newspaper is publishing articles stating that certain shares are going up because of rumours.

I mean shouldn't our financial news be reporting news instead of rumours?

Or are our financial news represent a tool for those who wants to push their shares higher?

Take Gamuda.

The shares moved higher this morning based on rumours.

Let's have a look at the chronology of events that had taken place so far.

Posted 7.55am.

• 1. KUALA LUMPUR (Dow Jones)--Several groups of investors, with the help of Middle Eastern funds, are working out a deal to take construction giant Gamuda Bhd. (5398.KU) private, The Edge reported Monday, citing an unnamed sources.
  "If things pan out, there should be some developments in a month or two," said one of the sources.
  Sources do not discount the possibility of Platinum Investment Management Ltd., one of Gamuda's two biggest shareholders, with a 7.49% stake, participating in the takeover, the financial weekly reported.

Unnamed sources! Just who are these sources?

Posted 8.51 am.

• 2. 0051 GMT [Dow Jones] Gamuda (5398.KU) may rise to MYR2.41 (recent high) vs Friday close at MYR2.27 (flat) as The Edge weekly reports several groups of investors with help of Middle Eastern funds planning to strike deal to privatize construction firm. "If things pan out, there should be some developments in a month or two," report cites unnamed source saying. Also, not ruling out possibility of Platinum Investment Management Ltd., one of Gamuda's 2 biggest shareholders, with a 7.49% stake, participating in takeover, the financial weekly reported. "Since the steep retreat in Gamuda's share price (from year-high of MYR5.75 to current price), all sorts of rumors have been swirling around the company, including the possibility of the company being privatized. This fresh report may create some excitement in early trade and boost Gamuda's share price," says dealer. (VGB)

Incredible! A target price is also mentioned!

Posted at 10.34 am.

• 3. 0234 GMT [Dow Jones] STOCK CALL: Affin Investment keeps Buy on Gamuda (5398.KU) but trims target to MYR2.94 from MYR3.15; follows 1.7%, 5.2% cut in FY09, FY10 EPS forecasts, lowering of property bookings by MYR100 million for both years. Adds, news report about several groups of investors with help of Middle East funds working out deal to take company private, not unexpected. Notes, Gamuda had no controlling shareholder, after sale of 70 million shares by managing director earlier this year, who further dispersed shareholding structure. "Any attempts to privatize the company at a price closer to the fair value should help investors realize potential capital gains earlier," says analyst Ong Keng Wee. Shares +4.4% at MYR2.37. (SJO)

See the point where it's mentioned that Gamuda had no controlling shareholder?

Posted 11.11am.

• 4. 0311 GMT [Dow Jones] Gamuda (5398.KU) +3.5% at MYR2.35 in heavy volume, off intraday high of MYR2.44; initial surge in share price attributed to The Edge report earlier about several group of investors planning to take company private, funded many middle eastern investors. "Talk of privatization has surfaced a number of times. Rumors on such exercise have emerged a number of times following (MD) Lin Yun Ling's decision to sell down his stake in the company to 1.7% from 5.2% in February," says dealer. However, Lin entered into afresh 5-year contract to stay on as Gamuda's MD 2 weeks ago, putting to rest fears of his departure. Dealer also notes power vacuum due to fragmented shareholding structure; Perak Royal family owns 7.5%, Platinum Investment Management owns 7.4%. Given "such depressed share prices and no controlling shareholder, Gamuda looks very appealing as a takeover target," dealer adds. Stock expected to trade within MYR2.30 to MYR2.40 for rest of day. (VGB)

Oh now this unnamed dealer says that Gamuda looks very appealing as a takeover target. I wonder why this dealer so shy to be named!

And published on Business Times, Gamuda climbs

• A newspaper reports that investors, backed by funds from the Middle East, are working on a plan to buy out the construction company
  
  SHARE prices of infrastructure group Gamuda Bhd were higher today following reports by a local newspaper that the company may be a buyout target by a group of investors from a Middle East Fund, dealers said.
  
  Its projects range from mega projects such as the internationally acclaimed SMART (Stormwater Management and Road Tunnel).
  
  It is also well-known for intra-urban highways, the Kaohsiung Mass Rapid Transit system in Kaohsiung, Taiwan, the Nam Theun 1 (NT1) hydropower project in Laos, the Dukhan Highway in Qatar, and airfield and road tunnel works for the New Doha International Airport in Qatar.
  
  There are also rumours that the company may be taken private.
  
  As at 10.20am, Gamuda rose nine sen to RM2.36. - Bernama

How nice!

On yet another very depressing day on the local stock stock market, Gamuda traded against the general downtrend to close at 2.40, up by some 5%.

And it all started from rumours based on unnamed sources!

How blatantly nice!

Publish some articles based on rumours from unnamed sources and the stock soars!

Are you EVEN watching SC?