| Singapore investment company Temasek Holdings' offer for Olam International could be a sector re-rating event, reflecting the potential for major shareholder groups to step in if soft commodity groups remain undervalued, said Barclays. This is especially since equity markets are too concerned with quarterly earnings numbers - often affected by volatile commodity markets - while strategic shareholders can take a long-term view on the key drivers of the business.
"The long-term drivers of constrained upstream productive resources and demand growth in emerging markets are secular trends, irrespective of the volatility in commodity markets," said Barclays analysts in a report. "In our view, Temasek's offer for Olam may reflect the potential for other shareholder groups to step in if they believe the equity market is not pricing in the earning potential."..............................................Full Article: Source
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