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CCT proposes raising S$220m from private placement to fund German acquisition

CAPITALAND Commercial Trust (CCT) has proposed a private placement of between 104.51 million and 107.68 million new units to eligible institutional, accredited and other investors at an issue price of between S$2.043 and S$2.105, to raise about S$220 million.

CapitaLand Commercial Trust Management, the manager of CCT, made known the proposed capital-raising exercise on Wednesday in a regulatory filing.

Of the S$220 million to be raised, the bulk - S$216.7 million - would be used to partially fund the acquisition of a 94.9 per cent interest in the holding companies of a freehold office building in Frankfurt, Germany. This acquisition was announced on Wednesday morning.

About S$3.3 million, which is approximately 1.5 per cent of the private placement gross proceeds, will be used to pay the estimated transaction-related expenses, including professional fees and expenses, incurred or to be incurred by CCT in connection with this fundraising exercise.

Together with the 591,739 units issued since Apr 10, the 104.51 million and 107.68 million new units to be issued pursuant to the private placement would constitute 2.8 per cent to 2.9 per cent of the 3.75 billion units in issue as at Apr 10.

The price range of between S$2.043 and S$2.105 (both figures inclusive) represents a discount of between 3.3 per cent and 6.1 per cent to the volume-weighted average price of S$2.1762 for trades on the Singapore Exchange on July 17.

The manager believes that the private placement is an overall efficient and beneficial method of raising funds to partially finance the acquisition.

DBS Bank and JPMorgan (SEA), the joint bookrunners and underwriters for the proposed private placement, will determine the issue price together with CCT's manager after a book-building process.

CCT units closed one Singapore cent or 0.46 per cent lower at S$2.17 on Wednesday before the announcement.