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Frasers Centrepoint Trust uses private placement proceeds to pare down revolving credit facilities
OVER half of Frasers Centrepoint Trust' s gross proceeds raised from its private placement has been allocated to temporarily pare down its revolving credit facilities, the real estate investment trust' s (Reit) manager said in a bourse filing on Wednesday.
The deployment of the proceeds to fund the acquisition of AsiaRetail Fund (ARF) is pending. The Reit had announced last month its plan to buy the remaining 63.1 per cent stake in ARF for S$1.06 billion.
The private placement raised gross proceeds of S$575 million at an issue price of S$2.35 per new unit. Some S$325.0 million went into paring down revolving credit facilities S$80.0 million was allocated to repaying a secured bank loan.
The balance has been used to pay the professional and other fees and expenses incurred from the private placement, and, pending the deployment of proceeds to fund the ARF Purchase, will be placed in fixed deposits.
Anyone knows why is there a huge transaction at SGD 2.33 after market close?
Right issues starting.
Other reits to follow suit.
Other reits to follow suit.
Frasers Centrepoint Trust' s placement, preferential offering priced at bottom end
FRASERS Centrepoint Trust' s (FCT) private placement has closed about 2.8 times subscribed and priced at the bottom end of the range, with the upsize option not exercised.
It raised gross proceeds of S$575 million at an issue price of S$2.35 per new unit, the real estate investment trust' s (Reit) manager said in a bourse filing on Tuesday before market open.
The issue price represents a 6.6 per cent discount to the volume-weighted average price (VWAP) of S$2.5171 based on all trades in FCT units on Sept 25 up to the time the underwriting agreement was signed on Sept 28.
For illustrative purposes only, the issue price is at a 4.9 per cent discount to the adjusted VWAP of S$2.4723 per unit, which subtracts the aggregate distribution of about 4.485 Singapore cents per unit.
The indicative price range for the private placement had stood at S$2.35 to S$2.435 per new unit. There was also an upsize option to issue additional units, which would have increased the placement' s total gross proceeds to around S$675 million.
The placement " drew strong demand from new and existing institutional and other accredited investors" , said the manager on Tuesday.
The manager on Monday afternoon announced an equity fundraising comprising the private placement and a non-renounceable preferential offering.
For the preferential offering, the issue price was likewise fixed at the low end of its range, at S$2.34 per new unit. This is at a 7 per cent discount to the VWAP and, for illustrative purposes, a 5.3 per cent discount to the adjusted VWAP.
The indicative price range had been S$2.34 to S$2.42 per unit for the offering.
On Tuesday, the manager said the preferential offering is expected to raise about S$759.7 million.
About 324.6 million new units will be issued, based on 290 preferential offering units for every 1,000 existing units held as at 5pm on Oct 6.
In addition, some 244.7 million new units will be issued under the private placement.
DISTRIBUTIONS
In connection with the private placement, the manager plans to declare - in respect of the existing FCT units - a cumulative distribution for the period from April 1, 2020 to the date immediately before the new units are issued under the placement. The private placement units are expected to be issued on or around Oct 7.
Also, the manager will declare a distribution of the Reit' s distributable income that was earlier retained for the periods from Oct 1, 2019 to Dec 31, 2019 and from Jan 1, 2020 to March 31, 2020.
The aggregate distribution is thus estimated to be 4.485 Singapore cents per existing unit. This is made up of the cumulative distribution of about 2.804 cents and the retained distribution of about 1.681 cents.
The manager said it will announce the actual quantum of the aggregate distribution in due course.
Assuming the preferential offering is fully subscribed, the equity fundraising' s gross proceeds will total about S$1.33 billion. This will comprise more than 45 per cent of FCT' s present market capitalisation, said Richard Ng, chief executive officer of the Reit manager.
About 76.3 per cent or S$1.02 billion of the gross proceeds will finance FCT' s acquisition of the rest of AsiaRetail Fund, while some 21.3 per cent or S$284.9 million will go into paring down existing debts.
If I' ve used cpf to buy, how do I make the payment pls?
Azure1984 ( Date: 28-Sep-2020 18:40) Posted:
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This caught my attention : The Cumulative Distribution for the period 1.4.2020 till 6.10.2020 is 2.804c. This period is for two months and 6 days into October. Let' s assume it is just for two months only. Hence, it' s 2.804c for half-year, equivalent to 5.608c per year.
If all these corporate actions have not been undertaken, the yield against the current price of $2.38 = ONLY 2.36% !
Assuming there is a dpu accretion of, say 5% after all actions have been completed, the dpu may rise to 5.888c. At 5.888c/$2.38, the yield is ONLY 2.47% ! Of course, today is stll Covid days,... how long will it take FCT to recover to pre-Covid level ?
If all these corporate actions have not been undertaken, the yield against the current price of $2.38 = ONLY 2.36% !
Assuming there is a dpu accretion of, say 5% after all actions have been completed, the dpu may rise to 5.888c. At 5.888c/$2.38, the yield is ONLY 2.47% ! Of course, today is stll Covid days,... how long will it take FCT to recover to pre-Covid level ?
Yes and no. In terms of your % holding of FCT, if you do not subscribe to the rights, there will be a dilution. However, the deal works in such a way that it will be DPU Accretive. So overall, you still get more DPU per share after the transaction, even if you do not subscribe to the rights.
lennyk ( Date: 29-Sep-2020 11:58) Posted:
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i ment Cannot* sell the rights
lennyk ( Date: 29-Sep-2020 11:53) Posted:
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but if we dont subscribe to the rights. and we can sell the rights
i understand it will lapse and the underwriters will buy the additional unsubscribed shares
will it lead to dilution of th retail holders ?
i understand it will lapse and the underwriters will buy the additional unsubscribed shares
will it lead to dilution of th retail holders ?
Might as well buy from open market where is it trade able
Azure1984 ( Date: 29-Sep-2020 11:23) Posted:
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If I read correctly, I dont think you can sell the preferencial shares as they are non-renounceable. For retail investor, the issue price is $2.34 just announced today, so I doubt the price will drop below $2.34. You can choose not to subscribe, no harm to your position as this acquisition will be yield accredative according to their published materials.
hokpin ( Date: 28-Sep-2020 20:20) Posted:
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Frasers Centrepoint Trust plans up to S$1.44b equity fundraising
THE manager of Frasers Centrepoint Trust (FCT) is looking to undertake a private placement at an issue price of between S$2.35 and S$2.435 per unit, as well as a non-renounceable preferential offering at between S$2.34 and S$2.42 per unit.
The proposed equity fundraising will partially finance the real estate investment trust' s (Reit) acquisition of the remaining 63.11 per cent stake in AsiaRetail Fund from its sponsor, Frasers Property, and pare existing debts.
Taken together, the placement and offering will raise at least about S$1.33 billion, and up to S$1.44 billion, the manager said in a bourse filing on Monday.
The private placement to institutional and other investors will involve some 236.1 million to 244.7 million new FCT units, to raise gross proceeds of up to about S$575 million. Moreover, there is an upsize option to issue up to about 42.6 million additional units, which will increase the placement' s total gross proceeds to around S$675 million.
The private placement' s issue price range is at a discount of 3.3 per cent to 6.6 per cent to the volume weighted average price (VWAP) of S$2.5171 per unit for all trades in the counter on Sept 25 up to the time the underwriting agreement was signed on Sept 28.
The placement will close on Tuesday, and the units are expected to be listed on Oct 7.
As for the preferential offering, between 313.4 million and 324.6 million new units will be offered to existing unitholders of FCT. This will bring in gross proceeds of at least S$746 million.
The offering' s issue price range is at a discount of 3.9 per cent to 7 per cent to the VWAP of S$2.5171.
Each eligible FCT unitholder will be provisionally allotted the units under the offering based on holdings in FCT as at 5pm on Oct 6. The provisional allotment of the preferential offering units cannot be renounced in favour of a third party or traded on the Singapore Exchange (SGX).
The preferential offering will then open on Oct 9 at 9am, and close on Oct 19 at 5pm.
The Reit manager and the underwriters will determine the issue price for the private placement after a book-building process. After that, the preferential offering' s issue price will be determined.
DBS, Citigroup Global Markets Singapore and OCBC are the appointed joint lead managers and underwriters for the equity fundraising.
Frasers Property - which owns a 36.57 per cent stake in the Reit via Frasers Property Retail Trust Holdings (FPRTH) and the manager - has provided an irrevocable undertaking that it will procure FPRTH and the manager to accept and subscribe for their total provisional allotment of the preferential offering units.
In addition, Frasers Property will procure that FPRTH and the manager make excess applications for up to 245.1 million additional preferential offering units that are not taken up by other unitholders.
As earlier announced, the private placement may include a proposed issue and placement of new units to the sponsor group. At an extraordinary general meeting (EGM) on Monday, unitholders approved this sponsor placement.
If Frasers Property and its subsidiaries are offered units under the sponsor placement, they will subscribe for these units, but only up to their proportionate unitholdings in FCT before the placement. This means the sponsor group' s percentage unitholdings in the Reit will stay the same after the private placement is completed.
Assuming the equity fundraising rakes in gross proceeds of about S$1.33 billion, the FCT manager plans to use about 76.7 per cent or S$1.02 billion to fund the purchase price for AsiaRetail Fund. The manager will also use some 20.9 per cent or S$277.5 million to pare down existing debt.
The FCT manager said the AsiaRetail Fund transaction and the equity fundraising - including the sponsor placement - represent " a rare opportunity" for the Reit to increase its number of retail properties to 11 from seven and to increase its retail net lettable area to 2.3 million square feet, making FCT one of Singapore' s largest suburban mall owners.
At the EGM on Monday morning, unitholders unanimously gave the green light for the AsiaRetail Fund share acquisition at a purchase price of close to S$1.06 billion.
They also approved the divestment of Bedok Point mall to a Frasers Property subsidiary for S$108 million, with holders of 99.99 per cent of units voting in favour.
Some 99.72 per cent gave their approval for the issue of up to 628 million new units in FCT under an equity fundraising.
SGX has given its approval in-principal for the new units, said FCT' s manager.
can anyone shed more light on this
as i understand it is for retail share holders
who hold shares as of 5 pm Oct
for every 1000 shares they will have to pay 2.34 x 290 = 678.6
which is compulsary as it is a non-renounceable offering
Is this accurate as i have put it above
--> or did i get it wrong ?
The manager on Monday afternoon announced an equity fundraising comprising the private placement and a non-renounceable preferential offering.
For the preferential offering, the issue price was likewise fixed at the low end of its range, at S$2.34 per new unit. This is at a 7 per cent discount to the VWAP and, for illustrative purposes, a 5.3 per cent discount to the adjusted VWAP.
The indicative price range had been S$2.34 to S$2.42 per unit for the offering.
On Tuesday, the manager said the preferential offering is expected to raise about S$759.7 million.
About 324.6 million new units will be issued, based on 290 preferential offering units for every 1,000 existing units held as at 5pm on Oct 6.
In addition, some 244.7 million new units will be issued under the private placement.
as i understand it is for retail share holders
who hold shares as of 5 pm Oct
for every 1000 shares they will have to pay 2.34 x 290 = 678.6
which is compulsary as it is a non-renounceable offering
Is this accurate as i have put it above
--> or did i get it wrong ?
The manager on Monday afternoon announced an equity fundraising comprising the private placement and a non-renounceable preferential offering.
For the preferential offering, the issue price was likewise fixed at the low end of its range, at S$2.34 per new unit. This is at a 7 per cent discount to the VWAP and, for illustrative purposes, a 5.3 per cent discount to the adjusted VWAP.
The indicative price range had been S$2.34 to S$2.42 per unit for the offering.
On Tuesday, the manager said the preferential offering is expected to raise about S$759.7 million.
About 324.6 million new units will be issued, based on 290 preferential offering units for every 1,000 existing units held as at 5pm on Oct 6.
In addition, some 244.7 million new units will be issued under the private placement.
Is it something like right issue? Can sell? Price will drop after put on listing?
hokpin ( Date: 28-Sep-2020 20:18) Posted:
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Bro, is it compulsory to purchase or no payment is needed?
Azure1984 ( Date: 28-Sep-2020 18:40) Posted:
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No action need to be taken. Just wait for 1-2 weeks for the circular mailed to you asking you to subscribe for the prederential shares for their asset acquiction of Asia Malls. Then go ATM and pay the preferential shares allocated to you will do.
hokpin ( Date: 28-Sep-2020 16:23) Posted:
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Hi, Bros, saw the announcement from SGX about the Placement Offer & Preferrential Offer. I can not understand what actions need to take. Can someone provide advice?
Why is the trading is halt today? Because of the EGM below?
Joelton ( Date: 28-Sep-2020 08:56) Posted:
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Frasers Centrepoint Trust justifies sale of Bedok Point in response to shareholders' queries
THE sale of Bedok Point by Frasers Centrepoint Trust (FCT) at S$108 million had raised questions from shareholders given that it was acquired at S$129 million.
In response to shareholder queries ahead of FCT' s extraordinary general meeting (EGM), the manager of FCT said that the mall' s size constraint and the lack of direct connectivity to key transportation nodes limited its ability to be the dominant mall within Bedok Town Centre.
Despite proactive leasing and repositioning strategies to stabilise its performance, competition remained stiff due to larger and better located new retail offerings.
As part of a proactive portfolio management strategy, various asset enhancement and redevelopment options were also evaluated, said the manager.
Preliminary approval was obtained for its redevelopment into residential with limited commercial on first storey. The negotiated sale price of S$108 million on the basis of Bedok Point as a redevelopment site was supported by two independent valuations. At the given valuation, the mall' s net property income yield stood at 2.5 per cent.
The manager therefore believes that the sale of Bedok Point for redevelopment would be in the best interests of unitholders as asset value is optimised and capital is redeployed towards higher yielding investments.
Separately, FCT had on Sept 3 proposed to acquire the remaining 63.1 per cent of ARF it does not own for S$1.06 billion. FCT intends to raise up to S$1.39 billion in equity through a private placement and/or a preferential offering to fund the acquisition. Following the acquisition, the manager said that it will focus on optimising the performance of its enlarged portfolio.
This will be done through economies of scale in its operations and purchasing and outsourcing of contracted services. FCT will also look to strengthen its retail platform and savings in interest expense through refinancing of existing debts and increasing financial flexibility by unencumbering some of the portfolio properties.
FCT also intends to remain Singapore-centric and suburban retail focused. Opportunities for growth include the retail assets in the sponsor' s portfolio, additional stake in Waterway Point which is currently held by three joint venture partners as well as third party opportunities that may present themselves from time to time, said the manager.
Completion of the proposed ARF acquisition and the proposed Bedok Point divestment are subject to unitholders' approval at the EGM to be held on Sept 28, and the fulfilment or waiver of the conditions under the ARF sale and purchase agreement and the Bedok Point put and call option agreement and purchase agreement.
Phase 3 is coming soon. Gov is charting out the details!