Isetan's explanation that its parent company is not able to support proposed rights issue not good enough

I refer to the article, 'Isetan proposes payout of $1.50 a share' (ST, Feb 28).

While the dividend payout is commendable, the explanation from Isetan Singapore that its parent company 'is, for its own reasons, not able to support a proposed rights issue at this point' (and therefore a higher $7.50 dividend payout) is clearly not good enough.

There should be more transparency.

As a shareholder, I would like to know whether the controlling shareholder in Japan has resolved the tax issue on its side. Given the much higher corporate tax rate in Japan, would setting up an intermediary holding company in Singapore to hold its dividend and rights entitlement and not repatriate the money be acceptable to the Japanese tax authority? Generally, no tax is payable if earnings are not repatriated.

Also, coming so soon after the EGM and with a cash hoard of slightly over $100 million, minority shareholders do understand it is clearly not sufficient for the higher dividend payout at this point in time.

This being the case, has Isetan explored the option for the sale and leaseback of its space at Wisma Atria? It should be able to fetch up to $300 million today.

With that amount of cash, Isetan Singapore could later declare not only a higher dividend to fully utilise the remaining tax credits but together with a rights issue has enough spare 'to face keener competition from new and revamped malls'.

It could use the extra cash to set up new shops at the coming new malls at Centrepoint and/or downtown IR resort.

Would Isetan Singapore provide shareholders some answers or progress report at the coming AGM?

Being a public listed company, it has certain responsibilities and that is to ensure that its minority shareholders are not kept in the dark and that the tax credits do not expire at their expense.

Lau Chee Kian