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AF Global sells London hotel for £84.4m

AF GLOBAL has agreed to sell its full ownerships rights to the Crowne Plaza London Kensington hotel in the United Kingdom for £84.4 million (S$146 million) in cash, the property and hospitality group said on Monday.

Those rights are the primary asset of LC London, AF Global's wholly owned subsidiary that is being sold to a buyer who was selected following a competitive bid process. The sale will represent a net gain of about S$14.4 million.

AF Global, also a subsidiary of Singapore-listed property companies Aspial Corp and Fragrance Group, said that if the deal had been completed on Dec 31, 2017, it would have raised 2017 net asset value (NAV) to 29.36 Singapore cents from 28 Singapore cents. The sale shares contributed just over 20 per cent of the group's NAV at the end of the third quarter of 2018.

The proceeds will go towards the full repayment of loans secured by the hotel and for the settlement of an inter-company loan owing from LC London to the company. The remaining funds will be used to bolster the group’s balance sheet, and to "facilitate any plans by the group to enhance shareholder value".

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The deal is expected to close on April 11, 2019.

Shares of AF Global closed on Friday at S$0.16, down one Singapore cent.