Sabana Shari'ah REIT

resolution 2 d,e,f refers to UNITHOLDERS able to appoint remove and re-appoint directors of the internal managers (not the REIT) just helping to be clear on the terminology.

https://sabana.listedcompany.com/newsroo...CFV1.1.pdf

Quote: "If the resolutions are passed and cannot be implemented at all, or within a reasonable timeframe, the trustee will, with its professional advisers, explore all options including the option of winding up the REIT. At least one of the additional EGMs requires unitholders to vote on an extraordinary resolution, for change of trust deed, which needs to be passed with a super majority."

https://sg.finance.yahoo.com/news/sabana...16749.html

(10-08-2023, 10:34 AM)ghchua Wrote:

(10-08-2023, 01:56 AM)steadyvalue Wrote: Don't see any need to change trust deed. In croesus case, the manager was also internalised with a simple majority vote. 

I believe the only outstanding part is resolution 2 part 4-6 which says amendment of trust deed to allow shareholders to appoint, remove and re-appoint directors.

But even that should be able to incorporate without changing trust deed as can be seen from croesus as well. Both are trusts.

Hi steadyvalue,

I beg to differ with you. Croesus Retail Trust is a business trust, not a REIT. You might ask, both are trusts so what is the difference?

A business trust is a hybrid structure consisting a company and a trust. Meaning, it is like a stapled structure. Since it already has a company in place in the structure, there is no need for amendment of trust deed for internalization. One can just fall back on the company side of the structure.

A REIT, however, is only a trust by itself, holding the underlying assets. The assets are managed separately by a manager. The wordings are really based on external manager structure, since they are supposed to be separate. Therefore, this needs to be changed for the purpose of internalization.

(10-08-2023, 10:34 AM)ghchua Wrote:

(10-08-2023, 01:56 AM)steadyvalue Wrote: Don't see any need to change trust deed. In croesus case, the manager was also internalised with a simple majority vote. 

I believe the only outstanding part is resolution 2 part 4-6 which says amendment of trust deed to allow shareholders to appoint, remove and re-appoint directors.

But even that should be able to incorporate without changing trust deed as can be seen from croesus as well. Both are trusts.

Hi steadyvalue,

I beg to differ with you. Croesus Retail Trust is a business trust, not a REIT. You might ask, both are trusts so what is the difference?

A business trust is a hybrid structure consisting a company and a trust. Meaning, it is like a stapled structure. Since it already has a company in place in the structure, there is no need for amendment of trust deed for internalization. One can just fall back on the company side of the structure.

A REIT, however, is only a trust by itself, holding the underlying assets. The assets are managed separately by a manager. The wordings are really based on external manager structure, since they are supposed to be separate. Therefore, this needs to be changed for the purpose of internalization.

However, from the way the internal manager is directed to be setup, it will also likely be a stapled security as well. each unitholder will hold 1 unit of the reit and 1 unit of the manager. 

Link REIT and most of the australia reits all under this structure. In this way, there is no need to amend the trust deed.

Hi steadyvalue,

(10-08-2023, 04:29 PM)steadyvalue Wrote: However, from the way the internal manager is directed to be setup, it will also likely be a stapled security as well. each unitholder will hold 1 unit of the reit and 1 unit of the manager. 

What I am saying here is that the current structure of the REIT in Singapore is not a stapled security structure, unlike a Business Trust.

Therefore, in order to cater for the change to an internal manager, changes to the trust deed of a REIT is needed, unlike Croesus Retail Trust which you have cited as it was a Business Trust structure to begin with.

(10-08-2023, 04:29 PM)steadyvalue Wrote: Link REIT and most of the australia reits all under this structure. In this way, there is no need to amend the trust deed.

I do not know about the trust deed of overseas REITs, as they might have catered for an internal manager structure before they were listed, since internal managers were popular in these countries in the first place.

(10-08-2023, 04:45 PM)ghchua Wrote: Hi steadyvalue,

(10-08-2023, 04:29 PM)steadyvalue Wrote: However, from the way the internal manager is directed to be setup, it will also likely be a stapled security as well. each unitholder will hold 1 unit of the reit and 1 unit of the manager. 

What I am saying here is that the current structure of the REIT in Singapore is not a stapled security structure, unlike a Business Trust.

Therefore, in order to cater for the change to an internal manager, changes to the trust deed of a REIT is needed, unlike Croesus Retail Trust which you have cited as it was a Business Trust structure to begin with.

(10-08-2023, 04:29 PM)steadyvalue Wrote: Link REIT and most of the australia reits all under this structure. In this way, there is no need to amend the trust deed.

I do not know about the trust deed of overseas REITs, as they might have catered for an internal manager structure before they were listed, since internal managers were popular in these countries in the first place.

Hi ghchua, i believe the Quarz guys have consulted with their lawyers. 

Given the the resolutions is framed, it suggest that they are going with stapled security path. if this is so, then there is no need to amend the trust deed. as the manager will sit outside the reit and is owned by the trustee on behalf of shareholders.

Hi steadyvalue,

The trustee had already said in the link below that further EGMs are needed for amendments to the Trust Deed to implement internalization in their letter.

Consistent with the Trustee’s Statement, the Trustee will now proceed with identifying and
appointing professional advisers to advise it on the implementation of the Resolutions, including the
holding of Further EGM(s) to seek Unitholders’ approval on, among other things, the necessary and
specific amendments to the Trust Deed by way of extraordinary resolution(s). During the transition
period, the Trustee will expect the Manager to continue to serve as interim manager until a
replacement internal manager is appointed.

https://links.sgx.com/1.0.0/corporate-an...9ead7980d9

(10-08-2023, 05:15 PM)steadyvalue Wrote: Given the the resolutions is framed, it suggest that they are going with stapled security path. if this is so, then there is no need to amend the trust deed. as the manager will sit outside the reit and is owned by the trustee on behalf of shareholders.

Even if it is a stapled security structure as mentioned by you, there is still a need to amend the trust deed because the current structure of Sabana REIT is a REIT structure, and not a stapled security structure like a Business Trust.

So, how are you going to implement this stapled security structure on the REIT without changing the trust deed when the manager is owned by the trustee and the trustee is not owned by the REIT currently? With internalization, unitholders need to own the manager.

(13-08-2023, 05:35 PM)ghchua Wrote:

(10-08-2023, 05:15 PM)steadyvalue Wrote: Given the the resolutions is framed, it suggest that they are going with stapled security path. if this is so, then there is no need to amend the trust deed. as the manager will sit outside the reit and is owned by the trustee on behalf of shareholders.

Even if it is a stapled security structure as mentioned by you, there is still a need to amend the trust deed because the current structure of Sabana REIT is a REIT structure, and not a stapled security structure like a Business Trust.

So, how are you going to implement this stapled security structure on the REIT without changing the trust deed when the manager is owned by the trustee and the trustee is not owned by the REIT currently? With internalization, unitholders need to own the manager.

The trust deed applies to Sabana REIT solely. in this case of stapling, every sabana reit shareholder will just gets a free share of the reit manager. This has no effect on the reit at all, and therefore does not impact the trust deed.

therefore is no need to amend the trust deed. Good reference pts are the australia reits. none require any trust deed amendments when they do their internalisation.

(15-08-2023, 10:59 PM)steadyvalue Wrote: The trust deed applies to Sabana REIT solely. in this case of stapling, every sabana reit shareholder will just gets a free share of the reit manager. This has no effect on the reit at all, and therefore does not impact the trust deed.

therefore is no need to amend the trust deed. Good reference pts are the australia reits. none require any trust deed amendments when they do their internalisation.

One couldn't just get a free share of the REIT manager and trade it separately. It had to be "stapled" with the REIT itself and becomes one stapled structure of a REIT and the manager. That itself is a change in structure as you need to make the REIT to come together with the manager. I dunno whether this will need a change in the trust deed. You mentioned Australian REITs but I am not sure what is the difference with their REIT trust deed and ours. They might have catered for the stapled security structure in their trust deed.

If I may refer you to a previous transaction in the Singapore REIT space, Ascott Residence Trust was merged with Ascendas Hospitality Trust. Since Ascendas Hospitality Trust was a Business Trust structure and Ascott Residence Trust was a REIT, changes to the trust deed of Ascott Residence Trust is needed in order to become a stapled security Business Trust structure to complete the merger.

Anyway, the trustee already indicated that we need further EGMs to implement this internalization. Let's wait for their updates before we comment further.

https://www.businesstimes.com.sg/compani...nalisation

It is now clear that whatever Quarz previously said about the trust deed isn't true already...

Is any unit holders here part of Sabana Growth Internalisation Committee? Anyone attended the last meeting? Did Quarz asked for any fees contribution?