GLP, MIT take a breather, count their gains

Their trading volumes continue to reflect healthy interest; both end higher for the week

SHARES of Global Logistic Properties (GLP) and Mapletree Industrial Trust (MIT) – the two largest initial public offerings (IPOs) this week – pulled back yesterday, as the broader market struggled for direction.

But their trading volumes continued to reflect the healthy interest in the counters – and both finished higher for the week.

Shares of GLP finished four cents down at $2.25 apiece yesterday, seeing almost 66 million shares change hands. MIT closed five cents down at $1.11, with almost 112 million shares traded.

One local trader attributed the dips in share price yesterday to investors being keen to lock in their profits on the two stocks before the end of the week.

And certainly, there was much to be had for MIT, whose share price soared 29 per cent to $1.20 in intra-day trade on its debut on Thursday, from an offer price of $0.93, before closing at $1.16. And, despite slipping yesterday, MIT still locked in a 19 per cent gain for the week.

Its closing price yesterday brings MIT's market cap to a total of $1.62 billion, based on a float of 1.46 billion shares. It is the largest Singapore real estate investment trust (Reit) IPO, to date.

MIT brings the combined market capitalisation of all the Reits and property trusts listed on the Singapore Exchange (SGX) – 24 in total – to some $36 billion, making Singapore the largest Reit market in Asia outside of Japan.

GLP also finished significantly stronger for the week. Its closing price of $2.25 yesterday is a 15 per cent gain on its $1.96 offer price. The counter also touched a high of $2.29 on Tuesday, the day after it made its trading debut.

Its market cap now stands at $10.1 billion, making it one of the larger stocks on the exchange.

GLP – which has Government of Singapore Investment Corporation (GIC) as its single-largest shareholder – is also the largest Reit IPO in the world.

It raised a total of $3.9 billion from its offering, having exercised its overallotment option of 234.6 million shares this week. This means, GLP beat out the previous record holder, Hong Kong-listed Link Reit which, in 2005, raised US$2.9 billion (S$3.8 billion) in its IPO.

GLP's IPO is also Singapore's second-largest after SingTel's in 1993, which raised $4 billion.

The sterling performance of the two new listings this week is expected to breathe life into the IPO market. Market watchers say GLP and MIT's performance this week should inspire other IPOs to come to the market.

SGX chief Magnus Bocker has said that he expects more IPOs in the current quarter, and that the number of IPOs should touch levels seen in the first quarter of fiscal 2010. In that quarter – or the three months ended September 2009 – SGX ushered in 11 new listings.

Buoyant MIT defies sombre sentiment

Mapletree Industrial Trust (MIT) made a strong debut on the Singapore Exchange (SGX) yesterday – a day when the broader market was dampened following news of China's surprise interest rate hike on Tuesday.

MIT soared to a high of $1.20 in intra-day trade, from its offer price of $0.93, before eventually closing at $1.16 – giving it a market capitalisation of $1.70 billion. The counter topped the volume list, with over 345 million shares changing hands.

And MIT, which raised $938.5 million from the initial public offer, said yesterday an over-allotment option of 91.75 million units – or 15.4 per cent of the total number of units in the offer – will be exercised in full by the joint book-runners.

This means a total of some 1.28 billion units will be sold, resulting in aggregate takings of $1.19 billion, at the offer price of $0.93.

The IPO – which included 489 million units that were placed out and 106 million units that were sold to the public – was 37.9 times subscribed, led by strong demand from institutional players.

323 million shares were subscribed for by six cornerstone investors – AIA, Prudential Asset Management (Singapore), Henderson Global Investors, Columbia Wanger Asset Management, US investment firm DE Shaw and Dutch pension fund APG. Mapletree's two subsidiaries, Mapletree Dextra Pte Ltd and Sienna Pte Ltd, subscribed for 359 million units.

MIT's performance compares with that of GIC's logistics arm, Global Logistic Properties (GLP) – Singapore's biggest IPO since 1993. Its shares jumped 11 per cent on its trading debut earlier this week, after raising $3.45 billion.

Shares of GLP continued to gain yesterday, closing $0.03 up at $2.29.

MIT's offer price represents an annualised distribution yield of 7.6 per cent for fiscal 2010, which is estimated to rise to 8 per cent for fiscal 2011. It expects to pay out all of its distribution income to unit-holders from listing until March 31, 2012.

MIT is managed by Mapletree Investments, in turn owned by Temasek Holdings. Mapletree Investments also manages Mapletree Logistics Trust and Lippo-Mapletree Indonesia Retail Trust. Part of the proceeds from MIT's IPO will be used to repay its existing debt and the purchase consideration for Mapletree Singapore Industrial Trust.

Tham Kuo Wei, CEO of Mapletree Industrial Trust Management, which manages Mapletree Industrial Trust, said yesterday: 'We believe the Singapore real estate investment trust market will continue to grow from strength to strength and that SGX offers an excellent platform for MIT to reach out to a large pool of sophisticated local and international investors.'

SGX said in a statement yesterday that it welcomes MIT's listing: 'With an extensive portfolio consisting of high-quality industrial properties, and a large and diversified tenant base, MIT presents investors an attractive opportunity to participate in Singapore's industrial property market.'

For Immediate Release

MAPLETREE INDUSTRIAL TRUST UNIT PRICE SURGED ON TRADING DEBUT
• Debuted strongly at S$1.15, representing an increase of 23.7% over the IPO Offering Price
• Closed at S$1.16, representing an increase of 24.7% over the IPO Offering Price
• Largest Singapore Real Estate Investment Trust IPO to-date
• Most active counter of the day with 345.0 million Units traded despite only three hours of
trading

Singapore, 21 October, 2010 – Mapletree Industrial Trust (“MIT”), a Singapore-focused real estate investment trust (“REIT”) and one of the largest landlords of industrial space in Singapore, enjoyed a strong trading debut at 2.00 p.m. today on the Main Board of Singapore Exchange Securities Trading Limited (the “SGX-ST”).

Raising gross proceeds of approximately S$1.19 billion from the offering of 594,913,000 Units to the public and under the placement tranche, as well as the Mapletree Cornerstone Subscription Units and the Cornerstone Units (as defined below), MIT is the largest Singapore REIT IPO to-date."

Excellent Debut

MIT’s units (“Units”) opened strongly at S$1.15 per Unit, a 23.7% increase over its offering price of S$0.93 per Unit (“Offering Price”). The Units reached an all-day high of S$1.20 per Unit, a 29.0% jump over its Offering Price. At the close of trading, the Units ended 24.7% higher than its Offering Price of S$0.93 at S$1.16 per Unit with approximately 345.0 million Units changing hands, making it the most actively traded counter on the SGX-ST today.

Commenting on the trading debut, Mr Tham Kuo Wei, Chief Executive Officer of Mapletree Industrial Trust Management Ltd, as manager of MIT (the “Manager”), said, “We are delighted with MIT’s excellent trading debut, which is a strong indication of the market’s confidence in the fundamentals and growth prospects of MIT.”

Overwhelming Response

The offering of 594,913,000 Units (the “Offering”), had earlier received overwhelming response with subscription rates of 27.7 times by retail investors (based on 80,645,000 Units and excludes the 25,500,000 Reserved Units) and 39.6 times by institutional investors (through the placement tranche comprising 488,768,000 Units).

The Sponsor1’s strong support of and commitment to MIT was demonstrated through its aggregate holding2 of 453,424,000 Units in MIT, which represents approximately 31.0% of the total number of Units in issue, with the over-allotment option exercised in full.

MIT had earlier secured prominent cornerstone investors such as Stichting Depository APG Tactical Real Estate Pool, American International Assurance Company Limited, Singapore Branch, American International Assurance Company (Bermuda) Limited, Henderson Global Investors, Columbia Wanger Asset Management, LLC, D.E. Shaw Valence International, Inc. and Prudential Asset Management(Singapore) Limited (acting for itself and on behalf of one or more investment funds and clients), who subscribed for an aggregate of 322,578,000 Units (the “Cornerstone Units”). These Cornerstone Units are also separate from the Offering.