Forterra Trust (formerly: Treasury China Trust)

[KopiKat]

Reading thro' the earlier SGX Annc again, extracts,

Background regarding Nan Fung Group

.

Nan Fung is a major real estate developer and investor in Mainland China and Hong Kong and the Board understands that Nan Fung considers Forterra Trust to be a real estate investment vehicle through which it can gain further exposure to the China commercial real estate sector.

From their website,

Business Structure
Corporate Milestones

IMO, main strength is still in Property and most likely, will follow the model "perfected" by our locally listed Capitaland... ie. Key attraction of Forterra - Ready SGX listed vehicle with assets in Tier 1 China city (Shanghai) at good discount to NAV (even at $2.98, it's still -25% discount ; Closest SGX listed comparable PCRT @ 19.7% discount to NAV, but has lower Gearing and pays DPU of 6.75% Yield), which can also be used as a vehicle (from ROFR) to inject their other assets + the Trust Mgr which will provide recurring income which can be increased by increasing AUM other other Fees (Acquisition, Disposal,...).

[freedom]

a GO is very unlikely as NF can buy all assets from Forterra directly to own only the good assets they want instead of going through so much trouble to buy more than that.

[opmi]

Can trigger a technical GO with no or low premium
to MKT price.

[KopiKat]

I doubt that a G.O. is their intent. IMO, there're a lot more "easy" money to be made by keeping it listed, using it as a vehicle to realise the "mkt values" for their unlisted property assets + recurring income as Mgr... what I'd already posted earlier.

[opmi]

GO dont mean delisting.

Being so close to 30% is quite troublesome if u intend to get shares for your assets.
Cannot go get whitewash waiver whenever Forterra issue shares for assets. Or even pay management fee.

[KopiKat]

For Biz Trusts, the recently listed ones and some of those who'd been listed longer, which don't have a >30% shareholder cum mgr,

APTT, Croesus, Religare, PCRT, a-iTrust

For REITs,

Suntec, A-REIT, Saizen, Fortune, AIMSAMPReit, FCOT, Cambridge, LMIR, CLT, Sabana, A-HTrust

The only pattern I can see is Ascendas seems to prefer not to hold >30% plus many Industrial REITs & perhaps those run by non-Singapore origin entities. Looks like dependent on individual preference??

[GreedandFear]

a GO is very unlikely as NF can buy all assets from Forterra directly to own only the good assets they want instead of going through so much trouble to buy more than that.

Hi Freedom.
How would NF be able to "buy all assets from Forterra directly to own only the good assets they want..." ? Board of Directors would have to sign off on asset sales (especially to a related party) and any significant discount to the CBRE valuation would raise red flags so Independent Directors would struggle. It seems to me that the only way they can get those assets on the cheap is by buying the shares given the NAV discount implied by the current share price ?

[freedom]

a GO is very unlikely as NF can buy all assets from Forterra directly to own only the good assets they want instead of going through so much trouble to buy more than that.

Hi Freedom.
How would NF be able to "buy all assets from Forterra directly to own only the good assets they want..." ? Board of Directors would have to sign off on asset sales (especially to a related party) and any significant discount to the CBRE valuation would raise red flags so Independent Directors would struggle. It seems to me that the only way they can get those assets on the cheap is by buying the shares given the NAV discount implied by the current share price ?

what I mean is that NF does not want to own all the assets that's why NF won't make a GO.

[opmi]

all discussions about GO is mainly in reference $2.98 price paid and will NF pay $2.98 for our Forterra shares.

All NF has to do is to make a voluntary GO AFTER 6 months of deal completion. Can pay any lower price after 6 months.
6 months is not a long wait. Besides the HQ (虹桥城）only TOP in 2014. Not urgent.

[KopiKat]

all discussions about GO is mainly in reference $2.98 price paid and will NF pay $2.98 for our Forterra shares.

Hmmm... that didn't even cross my mind... In fact, it'd appear to me that no one else in this thread seems to be expecting that?