CitySpring, Keppel Infra merger sends trusts up

Singapore

CITYSPRING Infrastructure Trust (CIT) was one of the top 20 traded counters by volume at the close of trading on Wednesday, with its counter rising three cents, or 5.8 per cent, to end trading at 54.5 Singapore cents. A total of 25.2 million shares changed hands.

Meanwhile, Keppel Infrastructure Trust's (KIT) counter gained 4.5 cents, or 4.3 per cent, to end trading at S$1.09.

Both KIT and CIT resumed trading on Wednesday, after announcing the night before that they planned to merge to create Singapore's largest infrastructure-focused business trust, with total assets of more than S$4 billion. This also makes the new combined trust Singapore's second-largest business trust.

The combined trust will also acquire a majority (51 per cent) stake in Keppel Merlimau Cogen for S$510 million from its sponsor Keppel Infrastructure Holdings. Keppel Merlimau Cogen owns a gas turbine power generation facility on Jurong Island. The purchase will be financed by an equity fund raising exercise.

KIT's counter hit a high of S$1.115 before it ended trading at S$1.09, after 5.4 million shares changed hands. CIT, on the other hand, hit a high of 56 cents before ending trading at 54.5 Singapore cents.

Shares of the two trusts had previously been halted since last Friday.

Temasek Holdings, CitySpring's biggest unitholder, will have the second largest stake in the combined trust after Keppel Corporation if the deal goes through.

Keppel's stock also gained nine cents, or 0.98 per cent, to close trading on Wednesday at S$9.27.