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Its portfolio will include 24 properties valued at $22.9 billion.The best way to analyse such a deal is to look at it from the angle of both parties separately. With the proposed merger, CapitaLand Commercial Trust holders will receive. The deal will benefit CMT unitholders in terms of both DPU and NAV-accretion, while CCT unitholders will also gain in terms of DPU growth.In addition, the enlarged REIT could theoretically benefit from economies of scale, portfolio diversification, and greater liquidity.That said, I have my doubts on whether it is the best use of capital by CMT due to the purchase price's 17 per cent premium to CCT's book value. Ultimately, because of the current market premium attached to CCT units, CMT will end up having to pay a 17 per cent premium to CCT's book value.Although the impact of paying above book value is countered by the fact that CMT will be issuing new units of itself at close to 25 per cent above book value, I can't hep but wonder if CMT could gain more by issuing new units to buy other properties at or below book values.At the other end of the deal, CCT unitholders are getting a stake in the merged entity and some cash for each unit they own.Here are the key things to note if you are a CCT unitholder:Based on pro forma calculations, the merger is DPU-accretive for CCT, if we assume that the cash consideration is reinvested at a return of 3 per cent per annum.From a book value perspective, the deal will be dilutive for CCT unitholders.
Even though that seems fair when you consider CCT's current unit price of $2.13, the purchase price is much higher than CCT's actual book value per unit of $1.82.Needless to say, CMT unitholders would benefit more if CMT is able to buy properties at or below their book value.
<> CapitaLand Commercial Trust Management Limited (Company Registration No. CapitaMall Trust currently makes up 9% of …
<>/Metadata 2506 0 R/ViewerPreferences 2507 0 R>> As I briefly mentioned earlier, bigger REITs benefit from diversification, cost savings and the ability to take on bigger projects.Although I think the deal is beneficial to unitholders of CMT, I doubt it is the most efficient use of capital.CMT is paying 0.72 new units of itself, plus $0.259 in cash, for each CCT unit.
0.72 CapitaMall Trust Units per CapitaLand Commercial Trust unit; S$0.2590 in cash per CapitaLand Commercial Trust unit; Pro Forma DPU Accretion. endobj
SINGAPORE (Jan 22): CapitaLand Mall Trust (CMT) and CapitaLand Commercial Trust (CCT) have jointly proposed the merger of their two REITs to create a diversified commercial REIT, CapitaLand Integrated Commercial Trust (CICT), through a trust scheme of arrangement.
CCT unitholders also have a lot to digest, and they will need to assess if they are comfortable that the deal will be dilutive to them from a book value perspective.Your daily good stuff - AsiaOne stories delivered straight to your inboxAsiaOne Online Pte Ltd. Company registration NO.201815023K CapitaLand Mall Trust and CapitaLand Commercial Trust - Update on Proposed Merger: Announcement Reference: SG200506OTHR91X5: Submitted By (Co./ Ind. CapitaLand Mall Trust (CMT) and CapitaLand Commercial Trust (CCT) are set to combine to form the largest REIT in Singapore.
Before the merger, each CCT unit had a book value of $1.82.After the deal, CCT unitholders will own 0.72 new units in the enlarged REIT and $0.259 in cash. Back 22 Jul 2020. For CMT unitholders, the merger will result in them owning a smaller stake in an enlarged REIT. The enlarged REIT will be renamed Capitaland Integrated Commercial Trust (CICT).The combined REIT will own both CMT and CCT's existing portfolios, making it the largest REIT in Singapore and the third-largest in Asia Pacific. The enlarged REIT (based on pro forma calculations) will have a NAV per unit of $2.11. Name) Michelle Koh: Designation: Company Secretary: Description (Please provide a detailed description of the event in the box below) Keep yourself up to date with all the latest announcements from CapitaLand Mall Trust I think so. 200309059W) JOINT ANNOUNCEMENT PROPOSED MERGER OF CAPITALAND MALL TRUST AND CAPITALAND COMMERCIAL TRUST BY WAY OF A TRUST SCHEME OF ARRANGEMENT 1. more. Proposed Merger Of CapitaLand Mall Trust And CapitaLand Commercial Trust - Dealings Disclosure. HO Mei Peng DID: +65 6713 3668 Email: ho.meipeng@capitaland.com. That works out to around $2.131 for each CCT unit.
The deal will be both DPU and NAV-accretive.
2 0 obj Proposed Merger Of CapitaLand Mall Trust And CapitaLand Commercial Trust - Dealings Disclosure. Here are the key points that investors should note:Based on pro forma calculations, the merger is distribution per unit-accretive.
The proposed merger is the latest in a string of mergers over the last few years.Mergers may benefit REITs through greater diversification, higher liquidity, cost savings due to economies of scale and access to cheaper equity.With that said, here are some things that investors should note about the proposed deal between the two CapitaLand REITs.CMT is offering to buy each CCT unit for 0.72 new units of itself and $0.259 in cash. 3 0 obj
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