Accordia Golf Trust reveals its parent is behind offer to buy entire portfolio

Singapore

JAPAN-BASED business trust Accordia Golf Trust, which last month saw units surge on the potential sale of all 88 golf courses in its portfolio, revealed on Friday that the offer to buy up the assets came from its own parent.

Accordia Golf Co, which has a controlling stake of 28.9 per cent in the trust, was behind the non-binding proposal disclosed on Nov 28, the manager has said.

The trust's manager did not name the suitor or price tag in either its initial announcement nor the update made on Dec 12, citing "confidentiality terms".

But it has now come out with a dollar value to the offer: 63.2 billion yen (S$783.1 million), including the holding company's debts.

Such a price tag would be subject to assumptions such as the financial and other performance of Accordia Golf Trust after the release of the proposal, though.

The portfolio's previously stated valuation was 144.7 billion yen as at Dec 31, 2018, according to independent appraisals.

Accordia Golf Trust also had 107.9 billion yen in liabilities as at Sept 30, 2019, as per unaudited second-quarter results that put distributable income at 2.27 billion yen for the half-year.

All the same, the manager added in its latest bourse filing that it was "not aware of any scheme" where Accordia Golf Co would make a bid to privatise the trust.

It also said that it "has not formally commenced discussions on the terms of the divestment", adding that no agreement has been reached on the price, timeline or any other terms.

There is no guarantee that the non-binding proposal, or any talks that result, will lead to any transaction, the board stressed.

The manager had said on Dec 12 that, if talks about divestment terms went ahead, the trust management and financial advisers would "undertake the discussions with the potential acquirer under the supervision of the board".

Deemed an interested person in the offer, Accordia Golf Co is also the controlling shareholder of the trust's manager, holding a 49 per cent interest against the 51 per cent owned by Daiwa Securities Group subsidiary Daiwa Real Estate Asset Management.

Daiwa Capital Markets Singapore and Ernst & Young Corporate Finance have been named the trust's joint financial advisers in evaluating the sale proposal.

Accordia Golf Trust units, which had traded at S$0.60 before the proposal was first disclosed, spiked to a high of S$0.76 on Dec 2. The counter most lately changed hands at S$0.675.