Month: November 2009
MapleTree – BT
MapletreeLog to raise $79m-82m for acquisitions
It will issue 115m new units through private placement
MAPLETREE Logistics Trust (MapletreeLog) yesterday launched a private placement to raise between $79 million and $82 million for acquisitions.
It plans to issue 115 million new units, which represent 5.9 per cent of all units in issue as at Sept 30. The new units will be priced at between 69 cents and 71 cents each, carrying a discount of 3.9 per cent to 6.6 per cent to the volume-weighted average unit price of 73.9 cents for trades in MapletreeLog’s units last Friday.
The trust manager and the placement agent Citigroup Global Markets Singapore will determine the issue price after a book-building process.
About $78 million from the private placement will go towards two yield-accretive acquisitions in Singapore. In one deal, MapletreeLog will buy a warehouse at 7 Penjuru Close for $43 million. The facility will have a gross floor area of around 41,253 square metres, and the land tenure will expire in May 2035.
MapletreeLog signed a put and call option agreement to buy the ramp-up six-storey single-user warehouse from SH Cogent Logistics.
SH Cogent will lease the property back for an initial 7-year term, which builds in an annual rental escalation of 2 per cent from the second year onwards. It will also have the option of extending the lease for another three years and thereafter, for four years.
According to MapletreeLog, the acquisition will add, on a proforma basis, 0.04 cents or 0.7 per cent to the annualised distribution per unit (DPU) for the period Jan-Sept.
In the second deal, MapletreeLog will be buying a multi-storey warehouse in the east for around $34 million. The trust manager signed a letter of interest for this asset on Oct 15.
MapletreeLog expects both local acquisitions to be completed by end-December, and their total returns will exceed 10 per cent. The trust’s annualised distribution yield as at Nov 9 was around 8.1 per cent.
Funding these two purchases through equity will leave MapletreeLog with enough debt headroom to buy a third asset in Japan. It signed a letter of intent and will pay about $68 million for a multi-storey single-user warehouse in the Greater Tokyo region.
The deal should be completed by the first quarter of next year. The trust expects the net property income yield of this acquisition to exceed 7 per cent, which is above that of its Japanese asset portfolio.
After these three purchases, MapletreeLog’s estimated gearing level will be around 38.5 per cent. Its gearing as at Sept 30 was 38.1 per cent.
The private placement is likely to reduce the stake held by MapletreeLog sponsor, Mapletree Investments, from 46.9 per cent to 44.3 per cent.
MapletreeLog units lost half a cent to close at 73 cents yesterday.
MapleTree – BT
Mapletree Logistics Trust on Monday launched a private placement of 115 million units to raise gross proceeds of between $79-82 million. The units would be priced between 69-71 cents apiece.
Net proceeds would go towards financing two proposed acquisitions in Singapore with. The estimated aggregate purchase price (including acquisition related costs) comes up to around $78 million.
Resulting debt headroom from the private placement would also be used to finance a proposed acquisition in Japan. The estimated purchase price (including acquisition related costs) is around $68 million.
MapleTree – BT
SINGAPORE- Mapletree Logistics Trust (MLT) has signed a put and call option agreement to acquire a warehouse in Singapore for $43 million (US$31 million), the property trust said on Monday.
The vendor of the property, located at 7 Penjuru Close, is SH Cogent Logistics Pte Ltd, which will lease back the property for an initial term of seven years with a rental escalation of 2 per cent per year from the second year onwards – with an option to extend for another three years and thereafter, for another four years.
SH Cogent is a total logistics solutions provider, providing services such as sea freight-forwarding, container leasing, hazardous cargo and chemical handling & storage and supply chain management, storage and packing services for import and export of vehicles.
The acquisition will be accretive to MLT’s distribution per unit (DPU). The pro forma financial effect of the acquisition on the annualised DPU (based on actual nine months financial results for 2009) is an additional 0.04 Singapore cents.
MI-REIT – BT
Big recapitalisation exercise at MI-Reit
$217.1m from AMP Capital, cornerstone investors and a rights issue; $214.9m from term and bridge loans
MACARTHURCOOK Industrial Reit (MI-Reit) has announced a slew of measures to recapitalise and refinance its debts and contractual obligations.
It has proposed to raise gross proceeds of $217.1 million through the issue of new units to AMP Capital Holdings and ‘cornerstone investors’ and followed by a rights issue. In addition, it has secured credit agreements for a term loan of $175 million and a bridge loan of $39.9 million.
With these transactions, the Reit’s short-term borrowings of $226 million due to mature by the end of this year will be fully refinanced.
Under the unit placement, AMP Capital is buying a 16.1 per cent stake in MI-Reit for $22 million. MI-Reit will issue 78.6 million new units to AMP Capital at $0.28 each. The issue price is at a 31.7 per cent discount to the closing price of $0.41 on Thursday.
This will usher in the Australian investment manager as a co-sponsor of MI-Reit to join hands with existing sponsor AIMS Financial Group.
MI-Reit is also issuing 142.9 million new and fully underwritten units to certain ‘cornerstone investors’, including 9.8 million units to its principal sponsor AIMS Financial Group at $0.28 apiece. The gross proceeds of $40 million will be partially used to meet a contractual obligation to pay $90 million for a private lot at 1A International Business Park.
Following these placements, MI-Reit will undertake a two-for-one rights issue, which is also fully underwritten. It will issue 975.6 million new units at $0.159 apiece to raise $155.1 million. The proceeds will be used to pay down debts and acquire properties from AMP Capital.
MI-Reit has agreed to acquire four industrial properties in Singapore from AMP Capital for $68.6 million to diversify its sources of income. These properties have initial yields of between 8.2 and 9.6 per cent.
‘The transactions are critical for MI-Reit and will restore MI-Reit to a stable platform,’ said Nicholas McGrath, CEO of the Reit manager. ‘The key benefits will outweigh the dilutive effects of the transactions on MI-Reit’s distribution per unit and net asset value per unit, and are in the best interests of unitholders.’
Speaking at a briefing yesterday, Mr McGrath said that he expects the rights issue to enjoy a good take-up as it is attractively priced.
MI-Reit will seek shareholders’ approval for these transactions at an extraordinary general meeting on Nov 23. MI-Reit will be rebranded as AIMS AMP Capital Industrial Reit.
Mr McGrath termed the transactions ‘transformational’ for MI-Reit. The Reit will enjoy support from the new sponsor AMP Capital, whose expertise in asset management and exposure in Asia Pacific complements AIMS’s direct fund management experience and presence in Australia and China.
MI-Reit will also have the first right of refusal to acquire AMP Capital’s logistics complex at 27 Penjuru Lane in Singapore, Mr McGrath said. There are opportunities over the next eight to 12 months for asset acquisitions given the properties identified under AMP Capital and other parties, Mr McGrath added.
To show its commitment, AMP will acquire 50 per cent of the Reit’s manager from AIMS and has committed to sub-underwrite a portion of the rights issue, bringing its total investment in MI-Reit to $54.1 million. This marks its first investment in an Asian Reit.
MI-Reit has separately signed a three-year term loan of $175 million with three banks – Standard Chartered Bank, Commonwealth Bank of Australia and National Australia Bank – and a bridge loan of $39.9 million with Standard Chartered Bank. These credit facilities will be used to partially refinance a Singapore dollar term loan.
The transactions are expected to pare down the Reit’s leverage from 44.7 per cent as at Sept 30 to 29 per cent on a proforma basis, Mr McGrath said.
MI-REIT – BT
MI-Reit posts 16% fall in Q2 income distribution
MACARTHURCOOK Industrial Reit (MI-Reit) reported a 16 per cent decline in income distribution to $5.17 million for its fiscal second quarter ended Sept 30 due to higher borrowing costs.
Distribution per unit (DPU) thus fell 17.5 per cent from a year ago to 1.939 cents. The Q2 distribution represents 100 per cent of the taxable income available for distribution. Gross revenue dipped 4.6 per cent to $11.83 million largely due to a reduction in service charge revenue.
MI-Reit said its income stream continues to be supported by a 98.8 per cent portfolio occupancy rate, with a weighted average lease duration of 4.2 years.
As at Sept 30, it holds 21 properties in Singapore and Japan with a total carrying value of $490.6 million and revalued net asset value of $0.94 per unit.
Ten properties are scheduled for rental rise ranging from 1.5 per cent to 5 per cent in fiscal 2010 ending March 31.
Its manager said it expects the economic outlook to remain challenging for the rest of this calendar year.
‘With the higher cost of borrowing, the income available for distribution in fiscal 2010 will be lower than in fiscal 2009,’ it added. But rental income is expected to remain stable.