Cambridge – SGX
ANNOUNCEMENT
LAUNCH OF GLOBAL OFFERING
Introduction
At the extraordinary general meeting of unitholders of CIT (the “Unitholders”) held on 25 September 2007 (the “EGM”), Unitholders approved, inter alia, the resolution for the issue of new units in CIT in connection with the Global Offering. Pursuant to such resolution, Cambridge Industrial Trust Management Limited, as manager of CIT (the “Manager”), is proposing to issue up to 285,119,729 New Units so as to raise gross proceeds of approximately S$193.9 million in the manner described in the Offer
Information Statement lodged with the Monetary Authority of Singapore on 1 October 2007 to finance the acquisition of six properties, namely, 1 Tuas Avenue 3, 7 Ubi Close, 9 Bukit Batok Street 22, 120 Pioneer Road, Enterprise Hub(1), 23 Woodlands Terrace (including costs associated with such acquisitions) and to potentially retire part of CIT’s existing debt obligations, with the balance of the proceeds to be utilised for general corporate and working capital purposes.
CLSA Merchant Bankers Limited and Merrill Lynch (Singapore) Pte. Ltd. (“Merrill Lynch”) have been appointed as joint global co-ordinators (the “Joint Global Coordinators”) for the Global Offering and the joint bookrunners for the Global Offering are CLSA Singapore Pte Ltd and Merrill Lynch (the “Joint Bookrunners” and together with the Joint Global Co-ordinators, the “Joint Global Co-ordinators and Joint Bookrunners”).
The offering price for each New Unit will be determined by the Joint Bookrunners in consultation with the Manager after a book-building process, and will be announced by the Manager thereafter via SGXNET.
The Global Offering
The New Units under the Global Offering will be privately placed to institutional and other investors by the Joint Global Co-ordinators and Joint Bookrunners.
Rationale for the placement of New Units to the Manager’s Directors and their immediate family
At the EGM, the Unitholders approved the placement of New Units to the directors of the Manager (the “Directors”) and their immediate family members as part of the Global Offering.
The Manager is of the view that a Director and his immediate family members should not be treated differently from any other Unitholder to whom New Units may be placed pursuant to the Global Offering, and should be given the opportunity to apply for additional New Units under the Global Offering since the other such Unitholders may also apply for additional New Units under the Global Offering.
Placement of New Units to the Relevant Institutional Investors under the Global Offering
The Manager has obtained a waiver of Rule 812(1) of the Listing Manual from the SGXST for the placement of New Units to certain institutional investors which each holds more than 5.0% of the Units in CIT (the “Relevant Institutional Investors”) under the Global Offering, subject to, inter alia, the following conditions in respect of the waiver from the SGX-ST that (i) the Manager certifies that it is independent of the Relevant Institutional Investors and (ii) the Manager announces any such placement.
Rationale for the placement of New Units to the Relevant Institutional Investors
The Manager is of the view that the Relevant Institutional Investors should not be treated differently from any other Unitholder to whom New Units may be placed pursuant to the Global Offering, and should be given the opportunity to apply for additional New Units under the Global Offering since the other such Unitholders may also apply for additional New Units under the Global Offering.
Cumulative Distribution and Status of the New Units
The next distribution in relation to CIT’s distributable income (the “Distributable Income”) was originally scheduled for the period from 1 July 2007 to 30 September 2007.
However, in conjunction with the Global Offering, the Manager has declared, in lieu of the scheduled distribution, a distribution of the Distributable Income for the period from 1 July 2007 to and including the day immediately prior to the date on which New Units are issued under the Global Offering (the “Cumulative Distribution”) which is on or around 18 October 2007. The Manager will announce the books closure date for the Cumulative Distribution shortly. The actual quantum of the distribution per existing Unit under the Cumulative Distribution will be announced after the management accounts of CIT for the relevant period has been finalised.
The New Units will, upon issue, rank pari passu in all respects with the Units in issue on the day immediately prior to the date on which the New Units are issued, which is expected to be on or around 18 October 2007, including the right to any distributions which may be paid for the period from the day the New Units are issued to 30 September 2007 as well as all distributions thereafter.
For the avoidance of doubt, the New Units issued in connection with the Global Offering will not be entitled to participate in the Cumulative Distribution.
Listing of the New Units
The indicative date and time of listing of the New Units on the SGX-ST is at 9.00 a.m. on 19 October 2007.
(1) Refers to 120 strata units in the building which is constructed on Lot 7659A of Mukim 5 at 48 Toh Guan Road East, Singapore 608586.
Source : SGX
MI-REIT
MACARTHURCOOK GROUP EXPANDS TEAM
Singapore, 1 October 2007 – Australian Securities Exchange listed MacarthurCook
Limited (ASX Code: MCK) is pleased to announce the appointment of the following senior
executives:
Ms Philippa Marshall has been appointed to Head of Legal & Compliance and will have global responsibility for all legal and compliance matters. In addition she will be Company Secretary of MacarthurCook Limited and MacarthurCook Fund Management Limited, the responsible entity of the MacarthurCook Property Securities Fund (ASX code: MPS) and MacarthurCook Asian Real Estate Securities Fund (ASX code: MSAS). Ms Marshall was previously General Manager Legal & Compliance of VicTrack and prior to this a partner of leading legal firm Blake Dawson Waldron.
Mr Andrew Bygrave has been appointed Head of Institutional Business for the MacarthurCook Group and will have international responsibility for investor relations, coordination of capital raisings, marketing and public relations. Mr Bygrave has over 10 years Investment Banking experience in corporate finance and legal. Mr Bygrave was previously Vice President at Deutsche Bank in Hong Kong, Vice President & Counsel with Credit Suisse in Australia and Legal Manager at Citigroup in London.
Mr Stuart Milham has been appointed to Joint Fund Manager of the MacarthurCook Industrial Property Fund. Mr Milham will also be involved with assisting SGX listed MacarthurCook Industrial REIT (SGX Code: MacCookIReit) on acquisitions, as well as driving acquisition of industrial assets in Europe and North America. Mr Milham has more than 16 years commercial and legal experience in the property industry. Most recently Mr Milham was Senior Legal Counsel at Austock Property Funds Management Limited where he was involved in property acquisitions, due diligence, leasing, financial structuring, capital raising and corporate advice in relation to the $300m ASX listed Australian Education Trust and a portfolio of industrial, hotel and infrastructure properties.
The MacarthurCook Industrial REIT team has expanded with the appointment of two new acquisition managers:
Mr Andrew Chee Chin Leong has been appointed as an acquisition manager to acquire property assets across Asia for MI-REIT. Mr Chee has over 13 years professional experience in property consultancy, valuation and business development.
Mr Alan Wong Peng How has been appointed as an acquisition manager to acquire property assets across Asia for MI-REIT. Mr Wong has over 12 years experience in business development with 7 years in the real estate industrial sector. Mr Wong was previously an Investment Manager with a leading industrial real estate developer.
We are pleased to announce the appointment of Ms Nancy Tan as Acting Fund Manager of MI-REIT, replacing Ms Christine Mount who will leave her current role effective 23 October 2007. Ms Tan, who is currently serving as Senior Asset Manager of MI-REIT, has more than 20 years experience in the commercial real estate and asset management industry and has held senior management roles with one of Singapore’s largest real estate developers. She has managed a portfolio of commercial assets in excess of $S1.0 billion.
As the MacarthurCook Group looks to expand its presence in Asia and Europe it is anticipated that further senior appointments will be made over the coming months.
REIT – BT
MAS tightens rules for Reits to protect retail investors
No more discounts for institutional investors at listing time
THE Monetary Authority of Singapore (MAS) has tightened up the rules for property funds to improve the odds for retail investors.
Institutional investors or the big boys will no longer have discounts for subscriptions made at the time of the listing of a real estate investment trust (Reit) under new guidelines for Reits issued by MAS yesterday.
Another change limits what’s allowed under fixed-term management contracts to five years.
These fixed-term management contracts have been used by fund managers as a poison pill to entrench their positions and to provide an obstacle to takeovers, as it makes it expensive to fire them.
In a statement, MAS said the revised rules ‘are intended to improve safeguards for investors and to provide greater clarity and flexibility for commercial transactions’.
MAS said a majority of the respondents to its public consultation exercise in March raised objections to disallowing discounts to institutional investors.
They felt that the discounts are justifiable because such investors enter into binding subscription agreements prior to the launch of the initial public offering (IPO); institutional investors were also said to have helped ensure the success of a Reit offering, particularly in difficult markets, by providing a useful signal to the retail market about the quality of the Reit.
Those who wanted to retain the discounts suggested full disclosure, putting a cap on discounts and/or a moratorium or the sale of the Reit units.
But MAS said: ‘As a matter of policy, there does not seem to be any good reason why different groups of investors should be permitted to pay different amounts for the same interests in these assets at the time of the IPO.’
MAS said it is prepared to allow discounts that are given to investors who assume equity risks different from those of IPO investors, for example if they are willing to underwrite the listing.
On management contracts which have been a contentious issue, the new guideline said the term of a compensation provision should not be more than five years and the compensation amount payable to the Reit manager should not exceed the sum of the fixed component of unearned management fees (excluding variable or performance fees) over the remaining term of the provision.
Industry players had argued that entrenchment clauses in management contracts were to help professional Reit managers who do not hold large stakes in a Reit and ‘would be discouraged from establishing Reits in Singapore if there is no flexibility to implement measures to obtain appropriate compensation if they are removed as managers’.
But MAS said: ‘We continue to be concerned with entrenchment arrangements that impede the market for corporate control and place significant restrictions on the ability of unit-holders to terminate management contracts.’
Ronnie Tan, chief executive of Bowsprit Capital, the manager of First Reit, said he supported not giving discounts to institutional investors.
‘It’s not fair for the small investors,’ he said.
He added that if demand is an issue, ‘Reit issuers should look at pricing rather than use discounts as a (sales) mechanism’.
‘Removal of the poison pill (means) the takeover rules would be similar to other listed companies,’ he said on the new rule which makes it easier to fire the Reit manager.
REIT Guideline – MAS
Singapore, 28 September 2007…The Monetary Authority of Singapore (MAS) has issued revised Property Fund Guidelines (REIT Guidelines). The revised Guidelines are intended to improve safeguards for investors and to provide greater clarity and flexibility for commercial transactions. The Guidelines have also been rationalised to reduce compliance costs in a number of areas.
2. The changes include:
- Enhancing the disclosure requirements on the use of short-term yield-enhancing arrangements;
- Providing guidance on permissible fixed-term management contracts;
- Disallowing discounts to institutional investors for subscriptions made at the time of listing of a REIT;
- Specifying safeguards for REITs that intend to pay dividends in excess of current income;
- Requiring a REIT to invest at least 75% of its assets in income-producing real estate; and
- Removing the 5% single party limit for investments in real-estate related securities.
3. MAS will amend the Securities and Futures Act (SFA) to include REIT management as a regulated activity. The Securities and Futures (Licensing and Conduct of Business) Regulations and Securities and Futures (Financial and Margin Requirements for Holders of Capital Markets Services Licences) Regulations will also be amended to set out the capital requirements and licence fees for REIT managers, as well as provide for a transitional period for existing industry participants.
4. In revising the REIT Guidelines, MAS considered feedback from its public consultation in March this year and held discussions with REIT players. Our responses to the comments received from the public consultation are published on the MAS website. (Click here to view) MAS will continue to engage industry players and ensure that our regulatory regime remains progressive and keeps pace with the market’s development and growth.
Source : MAS
PLife – UOBKH
An oasis in time of turbulence
Parkway Life REIT invests in income-producing real estate assets in the Asia Pacific region. The assets, used primarily for healthcare and related purposes, include hospitals, ambulatory surgery centres, primary clinics, medical office building, step-down care facilities such as nursing homes, research & development facilities and pharmaceutical facilities. The initial portfolio comprises Mount Elizabeth Hospital, Gleneagles Hospital and East Shore Hospital in Singapore.
Riding on growth in healthcare focus. The annual rental payable by Mount Elizabeth Hospital, Gleneagles Hospital and East Shore Hospital comprises a base rent and a variable rent. The variable rent is equivalent to 3.8% of adjusted hospital revenue. Adjusted hospital revenue encompasses inpatient, outpatient, car park, retail pharmacy and food & beverage revenues. This allows unitholders to ride on the growth of the healthcare industry due to an ageing population, medical tourism and growing affluence in Singapore and across the region.
Downside protection enhances defensive qualities. The minimum rent payable by each hospital is set at Consumer Price Index + 1% above rent payable in the preceding year. Where Consumer Price Index is negative for any given year, then it is deemed to be zero. This ensures that total rent payable is always increasing, which enhances the defensive quality of Parkway Life REIT.
Acquisition strategy drives growth in distribution yield. Parkway Life REIT has been granted the first right of refusal by Parkway Holdings over future sale of healthcare and related facilities. It will diversify its portfolio by acquiring medical offices, research & development facilities, storage and distribution facilities for pharmaceutical companies, and nursing homes.