All quiet on the Eastern front

On 28 Dec, EH announced that negotiations pursuant to the previously announced non-binding Letter of Intent entered into with Singapore Press Holdings regarding the divestment of several of the Company's exhibition businesses have ceased. Both parties were unable to reach agreement and will not proceed with the proposed transaction.

MYOB thinks that this is a non-event. The magazine business is a good cash cow that can provide some stability to EH, especially if the state of the economy is more uncertain now. Property development should slow down.

Sale of 71, 71A, 71B Tras Street.
A little welcome news. This should lend some support to the earnings.

Since the last update, EH has fallen in tandem with the market. Coupled with the one-for-two bonus, EH has fallen to 20 cents. At this price, EH's market cap is back to $60 million.

Director Kenneth Tan is also lending some support to the share prices. He bought 20k shares at 19 cents on 16 Jan 08. Although insignificant, this presents some confidence in EH.

MYOB's quick back of the envelop calculation puts EH at almost $140 million. Given that the fluff in the market is almost gone, discounting some already conservative numbers, MYOB puts EH at $120million, which is double from here.

In this market, MYOB remains cautious but sees low risk in putting some money into EH at this point. Caveat emptor!