Author: tfwee
Cambridge – SGX
ISSUE OF 276,973,000 NEW UNITS IN CAMBRIDGE INDUSTRIAL TRUST
Issue of 276,973,000 New Units
Further to its announcement on 2 October 2007 in relation to the launch of the Global Offering, Cambridge Industrial Trust Management Limited, as manager (the “Manager”) of Cambridge Industrial Trust (“CIT”), wishes to announce that it has today issued 276,973,000 new Units (the “New Units”) in CIT. With this issue of 276,973,000 New Units, the total number of units in CIT in issue is 792,278,653(1). The New Units will commence trading on the Main Board of the Singapore Exchange Securities Trading Limited at 2.00 p.m. on 18 October 2007.
Status of the New Units
The New Units will, upon issue, rank pari passu in all respects with the units in issue on 17 October 2007, being the day immediately prior to the date on which the New Units are issued, including the right to any distributions which may be paid for the period from 18 October 2007 to 31 December 2007 as well as all distributions thereafter.
(1) This includes the 801,493 new Units which were issued to the Manager on 12 October 2007 as settlement of 97% of the base fee element of the management fee payable to the Manager in respect of the initial portfolio of CIT comprising 27 properties from 1 July 2007 to 30 September 2007.
Source : SGX
Altitude Aircraft Leasing Trust – BT
Don’t dismiss aircraft trust
WITH GE’s Altitude Aircraft Leasing Trust looking to a listing on the Singapore Exchange, investors will have another asset class to look at. But how do aircraft match up against the other asset types, such as real estate or ships?
On gut feel, one might imagine the global aviation industry is facing more challenges than it can handle. Exogenous shocks from terrorist attacks and contagious diseases like Sars have surely hurt passenger traffic, and within the industry, legacy carriers and national airlines face stiff competition from low-cost carriers. Major US carriers floundered in bankruptcy as recently as 2005.
But the sector has recovered. Bankruptcy regulations allowed North American operators to renegotiate labour contracts and to cut costs. With economic growth, their operating profits rose to US$7.4 billion in 2006, against operating losses of US$300 million in 2005, according to the International Air Transport Association. Delta and Northwest were the last two American carriers to emerge from bankruptcy this year.
Further, it is wrong to think global air travel fell significantly, even following the worst of 9/11 and Sars. Figures from aviation consulting firm Simat Helliesen & Eichner (SH&E) show that global passenger and freight traffic – key determinants of demand for aircraft – have been rising steadily over the last 30 years.
Since 1991, air traffic dipped in only two years: 1991, prior to the first Gulf War, and 2001, following 9/11. And unlike the average stock market tumble that wipes out a fifth of an exchange’s market value, these were genuinely dips, not plunges, in traffic.
Sars certainly hit Asian air traffic hard. On the other side of the Pacific, Air Canada was the exception that proved the rule – with the largest domestic Asian population of any country in the world outside of Asia, Canada saw plummeting air traffic, nearly plunging its national carrier into bankruptcy. But other visitors to Asia are holiday-makers from Europe, who simply decided to fly somewhere else around the sunnily unaffected Mediterranean for their vacation. So European air traffic rose, offsetting the Asian decline on a global level.
This is significant because, as a senior aviation banker puts it, aircraft are ‘about as mobile as assets can get’. During Sars, he says, aircraft were redeployed from Asia to the US and Europe, while subsequently, as US airlines face troubles, aircraft have been transferred and put to use in Asia.
Thanks to growing wealth levels, Asia is where the growth is. According to SH&E and Boeing estimates, Asia’s passenger traffic growth is expected to rise by 7.1 per cent per year till 2026, compared to 4.1 per cent in North America and 5.6 per cent in Europe. Freight traffic is projected to grow faster.
Demand for new aircraft
The upshot is that many new aircraft will be needed. Consider that in China, there are only 1.3 passenger aircraft, including backlog orders, per million people, compared to 3.7 in the rest of the Asia-Pacific, and 30.4 in North America.
Airlines will also need to renew their fleets. US carriers tightened their belts during the lean years of 2000-2005 and have ageing fleets. Further, high fuel costs – jet fuel prices more than doubled between December 2003 and April 2007 – and concerns over global warming mean that the aviation industry will need new, efficient aircraft and engines.
None of this would matter to trust investors if not for the fact that about 30 per cent of the world’s aircraft in operation today are on operating leases, or about US$150 billion worth. By historical trends, this is expected to rise to 40 per cent over the next 10 years. If, as one banker believes, about US$50 billion to US$60 billion worth of aircraft will be delivered per year in the coming years, even established airlines, let alone start-up LCCs, will need financing support. The banker thinks between half to two-thirds of the value of annual deliveries will need third-party financing.
Competition for assets exists, from RBS and Macquarie, from Boeing, and from listed trusts like Ireland-based Aircastle Aviation. But AALT has the advantage of counting GE Commercial Aviation Services, the world’s single largest jet operating lessor with a fleet of over 1,700 aircraft, as sponsor. With the world’s second largest player, International Lease Finance Corp, which has nearly 1,000 aircraft, GECAS accounts for over half of the world’s aircraft.
So, while details on AALT’s initial public offering have yet to emerge, if you’re a yield investor, don’t be turned off just because it deals in aircraft.
Reference : Preliminary Prospectus
First Reit – SGX
For more information, click here.
K-Reit – SGX
PAYMENT OF MANAGEMENT FEES BY WAY OF UNITS IN K-REIT ASIA
This mode of paying the Company’s management fees in the form of Units is provided for in the trust deed constituting K-REIT Asia. With this payment, the Company’s current holding of Units is 2,683,077 Units.
Source : SGX
Cambridge – SGX
CAMBRIDGE INDUSTRIAL TRUST’S GLOBAL OFFERING RECEIVES STRONG SUPPORT FROM INVESTORS
• Cambridge Industrial Trust successfully raises S$193.9 million through a Global Offering of New Units
• Global Offering approximately 1.6 times subscribed by over 50 institutional investors
• Trading of the New Units on the Main Board of the SGX-ST expected to commence at 2.00 p.m. on Thursday 18 October 2007
Cambridge Industrial Trust Management Limited, as manager of Cambridge Industrial Trust (“CIT”) (the “Manager”) is pleased to announce that the private placement of 276,973,000 New Units in CIT (the “New Units”) to institutional and other investors outside of the United States in reliance on Regulation S under the U.S. Securities Act of 1933 (the “Securities Act”) and to qualified institutional buyers within the United States in reliance on Rule 144A under the Securities Act (the “Global Offering”) has received strong support from investors. The Manager received indications of interest for approximately 1.6 times the total New Units offered, with over 30% of demand for the New Units coming from institutional investors domiciled in the United States. The Manager believes that CIT is the first Singapore REIT to offer new units into the United States in reliance on Rule 144A of the Securities Act.
Book-building for the Global Offering commenced on 1 October 2007 through CLSA Singapore Pte Ltd and Merrill Lynch (Singapore) Pte. Ltd. as joint bookrunners (“Joint Bookrunners”). Following a positive response to the Offering from over 50 institutional investors, the Manager together with the Joint Bookrunners has decided to offer the New Units at a price of S$0.70 per unit (“Global Offering Price”).
The Global Offering Price represents a discount of approximately 6.67% to the closing price of CIT’s on the Singapore Exchange Securities Trading Limited on 12 October 2007 of S$0.75.
For the financial year ending 31 December 2008, all Unitholders can expect to receive a distribution per unit of 5.542 cents1 . Based on the Global Offering Price of S$0.70 per New Unit, the projected 2008 yield is 7.9%.
Mr Ang Poh Seong, CEO of the Manager, said: “We are very pleased to receive strong support from new and existing investors in CIT. The offering was large at about 53.8% of CIT’s units in issue as at 31 July 2007, but the issue has still been a great success. With over 50 high quality investors participating in the offering, we are very pleased at the response to the Global Offering. Investors have shown confidence in our strategy and the long term growth potential of CIT. We will continue to grow our portfolio and will capitalise on the potential of the industrial property sector in Singapore and in Asia for the benefit of our unitholders”.
An aggregate of 276,973,000 New Units will be issued bringing the total number of Units in issue to 792,278,653. The New Units are expected to commence trading on the Main Board of Singapore Exchange Securities Trading Limited (“SGX-ST”) at 2.00 p.m. on 18 October 2007. The New Units will, upon issue and allotment, rank pari passu in all respects with the existing Units, including the right to any distributions which may be paid for the period from 18 October 2007, the date the New Units are issued to 31 December 2007, as well as all distributions thereafter. The New Units will not be entitled to participate in the distribution of any distributable income accrued by CIT prior to the date of issue of such New Units.
1 Based on the Global Offering Price and various assumptions contained in the offer information statement lodged with the Monetary Authority of Singapore on 1 October 2007 for the projection year from 1 January 2008 and ending 31 December 2008.
Source : SGX