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ESR-REIT
17-06-2019, 07:39 PM.
Post: #1
ESR-REIT
ESR-REIT proposes equity fund raising to raise gross proceeds of up to $150 mil to finance property acquisition, AEIs

Stanislaus Jude Chan 
17/06/2019, 11:46am

SINGAPORE (June 17): The manager of ESR-REIT has proposed an equity fund raising exercise to raise gross proceeds of up to $150 million.

Around $44.4 million, or 29.6% of the gross proceeds of the equity fund raising, will be used to fully finance ESR-REIT's acquisition of a property at 48 Pandan Road.

A further $56.8 million, or 37.9% of the gross proceeds of the equity fund raising, will be used for ESR-REIT’s debt repayment in relation to the proposed acquisition as well as proposed asset enhancement initiatives (AEIs).

First, ESR-REIT will offer 195 million new units at an issue price of between 51.5 cents and 52.5 cents in a private placement to institutional and other investors to raise gross proceeds of at least $75 million.

The issue price represents a discount of between 6.5% and 8.3% to the volume weighted average price (VWAP) of 56.16 cents per unit that ESR-REIT traded at from the preceding market day on June 14 up to the signing of the placement agreement on June 17.

Including an upsize option, the private placement is expected to raise total gross proceeds of up to $100 million.

The issue price for the private placement will be determined by the manager and the joint global coordinators and bookrunners – Citigroup Global Markets Singapore and RHB Securities Singapore – following a book-building process.

At the same time, ESR-REIT is also planning a non-renounceable preferential offering of new units to existing unitholders to raise gross proceeds of up to $75 million.

The structure and timing of the preferential offering, which is not expected to be underwritten, have not yet been determined. Details will be announced later.

The manager says the preferential offering issue price will not be at more than 10% discount to the VWAP for trades done on the full market day on which the preferential offering is announced, or for the preceding market day up to the time it is announced.

ESR-REIT’s sponsor, ESR Cayman, has said it will provide an undertaking to the manager to apply for any new preferential offering units that remain unsubscribed. ESR Cayman currently owns a 9.4% stake in ESR-REIT.

More details in https://www.theedgesingapore.com/news/eq...il-finance
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