ESR-Reit prices private placement at 37.2 S cents, 3.4 times subscribed

ESR-REIT'S private placement to raise S$100 million was 3.4 times subscribed following a book-building process, the manager said on Friday. The upsized option was also fully exercised.

The issue price was fixed at 37.2 Singapore cents per new unit, the lower end of its indicative range of 37.2 cents to 38.4 cents.

This represents a discount of about 8.9 per cent to the volume-weighted average price of 40.84 Singapore cents per unit for all trades done on Thursday, up to the time of the signing of the placement agreement on Thursday.

The manager said the private placement saw strong participation from new and existing institutional and other investors.

About S$71.8 million of gross proceeds will be used to partially finance ESR-Reit's acquisition of a modern ramp-up logistics asset located at 46A Tanjong Penjuru.

Some S$24.5 million will be used to partially finance the asset enhancement initiatives of two industrial buildings at 16 Tai Seng Street and 7000 Ang Mo Kio Avenue 5.

The remaining S$3.8 million will be used for estimated fees and expense incurred in connection with the equity fundraising exercise, which also includes a preferential offering.

ESR-Reit's manager plans to undertake a non-renounceable preferential offering of new units to raise no more than S$50 million, it said in a separate announcement on Thursday.

Details of the preferential offering, which will not be underwritten, have not been determined but the manager said the issue price of the offering may differ from the private placement's issue price.

The manager called for a trading halt before market open on Thursday. The units last traded at S$0.41 on Wednesday.