FCT – BT

FCT raises $64m from placement

The trust will use the money raised to part-finance Bedok Point’s acquisition

FRASERS Centrepoint Trust (FCT) has raised net proceeds of $64.3 million from a private placement of units, to partially fund the acquisition of Bedok Point.

The private placement saw strong demand from more than 30 new and existing institutional investors in Asia and Europe, with the subscription rate coming in at around 4.1 times. The new units were priced at $1.39 each, which is at the top of the $1.35-1.39 offer price range announced on Wednesday night.

The offer price carries a discount of about 2.5 per cent to FCT’s adjusted volume-weighted average unit price of $1.426, for trades done on Wednesday.

‘The strong investor demand for the placement in FCT’s units amidst a volatile market environment demonstrates investors’ confidence in FCT’s growth strategy and its potential to deliver attractive total returns to its unitholders,’ said Philip Eng, chairman of FCT’s manager.

Given the high subscription rate, FCT’s sponsor Frasers Centrepoint Limited will not be taking up its pro rata portion of units in the private placement. This will help increase FCT’s trading liquidity.

FCT will use the money raised to part-finance the acquisition of Bedok Point. It will be using both debt and equity to purchase the mall, at an acquisition cost of around $129.1 million.

FCT expects to issue new units from the private placement on or around Sept 23. For existing unitholders, it will be declaring an advance distribution of distributable income for the period of July 1 to the day immediately before the date on which the new units will be issued.

The new units will not be entitled to this advance distribution. The books closure date for the advance distribution is Sept 22 and it will be paid on or around Nov 8.

The next distribution will comprise the distributable income from the day the new units are issued to Dec 31. Quarterly distributions will resume thereafter.

FCT ended trading on the stock market yesterday at $1.44, shedding 1.5 cents.