The listing will help the company accelerate growth of its shopping mall business in Malaysia, as the property trust will provide direct access to both the domestic and international capital markets.
CapitaMalls Asia told the Singapore Exchange (SGX) yesterday that it had received the approval from Malaysia's Securities Commission (SC) to list CapitaMalls Malaysia Trust (CMMT), which will hold the company's three Malaysian shopping malls.
They are Penang's Gurney Plaza, Sungei Wang Plaza in Kuala Lumpur and The Mines in Seri Kembangan, Selangor - with a total property value of RM2.13 billion and total net lettable area of 1.88 million sq ft.
However, the decision on when to list the REIT will also depend on several factors, including prevailing market conditions.
The listing is for 1.35 billion CMMT units, of which 786.52 million units, or 58.26 per cent, will be offered to Malaysian and foreign institutional and other investors as well as Malaysian retail investors.
CapitaMalls Asia will retain an interest of 33.00 per cent to 41.74 per cent in CMMT after the offer, dependent on whether an over-allotment option is exercised.
Two cornerstone investors, the Employees Provident Fund and Great Eastern Life Assurance (Malaysia) Bhd, have committed to subscribe 90 million units, or 11.4 per cent, of the total units offered.
They will pay RM1.10 per unit or the institutional price, whichever is lower. The estimated distribution yields for 2010 and 2011 are 6.5 per cent and 6.8 per cent respectively.
While no definitive price has been fixed, the company could raise some RM995 million based on a price of RM1.10 per unit if CapitaMalls Asia chooses to retain an interest of only 33 per cent.
The trustee for CMMT is AmTrustee Bhd.
Malaysia is a key growth market for CapitaMalls Asia and the third largest contributor to the company's earnings before interest and tax for the financial year ended December 31 2009, contributing S$52.4 million.
The company said that CMMT will be Malaysia's largest listed "pure-play" shopping mall REIT by market capitalisation and property value.
The REIT will be CapitaMalls Asia's designated listed vehicle to hold its stabilised Malaysian retail assets as the company seeks to capitalise on acquisition opportunities in Malaysia.
Business Times reported recently that CapitaMalls Asia plans to invest some RM3.5 billion in Malaysia over the next two to three years to buy existing malls and build new ones.
"The planned listing of CMMT is part of the company's strategy to list in the home markets of our assets, and to recycle capital for reinvestment. It will enable us to accelerate our growth in Malaysia, and develop fee-based income for the company," said CapitaMalls Asia chief executive officer Lim Beng Chee in the statement yesterday.
This is the second REIT that CapitaLand Group is sponsoring in Malaysia, the first being Quill Capita Trust which was listed in 2007.
By Business Times
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