FirstREIT – BT

First Reit in rights issue of $172.8m

FIRST Real Estate Investment Trust (First Reit) plans to make a renounceable rights issue to raise $172.8 million to acquire two healthcare properties in Indonesia.

A total of 345.66 million new rights units will be offered to existing unit-holders on the basis of five rights units for every four existing units, at 50 cents per unit. The issue price represents a discount of 47.4 per cent to the closing price of 95 cents per unit on Nov 4. First Reit units closed unchanged at 98 cents yesterday.

The 160-bed Mochtar Riady Comprehensive Cancer Centre (MRCCC) is being acquired from Wincatch Ltd and the 75-bed Siloam Hospitals Lippo Cikarang (SHLC), from First Reit sponsor PT Lippo Karawaci. The two properties will cost a total of $205.5 million, with the MRCCC accounting for $170.5 million of this.

The net proceeds from the rights issue will be boosted by a new term loan facility of up to $50 million.

First Reit says that the purchase prices of MRCCC and SHLC represent discounts of 19.7 and 13.8 per cent respectively to the average of the properties’ latest independent valuations. They will boost the value of the Reit’s assets by 74.3 per cent to $603.4 million, and the gross floor area of its portfolio by 58.7 per cent to 132,696 square metres.