FCT’s private placement raises S$220 million to finance Northpoint City deal, repay debt

[SINGAPORE] Frasers Centrepoint Trust (FCT) closed its upsized private placement at S$2.09 apiece, raising around S$220 million in gross proceeds with some 105.3 million new units to be issued.

At the enlarged size, it was about four times covered. Alongside a preferential offering, this brings its total equity fundraising to around S$421.3 million, said the manager in a Wednesday (Mar 26) media statement. 

The private placement is part of FCT’s equity fundraising exercise, announced on Tuesday, that aims to offer new units to raise gross proceeds of around S$400 million at minimum via a private placement, a preferential offering and a potential issuance of subordinated perpetual securities.

The new private placement units are expected to be issued on or around Apr 4.

The S$2.09 per unit issue price represents a 5.6 per cent discount to the volume weighted average price (VWAP) of S$2.2136 apiece for all trades done on the Singapore Exchange for Monday until the time the underwriting agreement was signed on Tuesday.

For illustrative purposes, it represents a 2.9 per cent discount to the adjusted VWAP of S$2.1521 per unit, after subtracting the estimated cumulative distribution range of $0.0615 per unit.

Some 98.6 per cent of the total gross proceeds, around S$415.2 million of the S$421.3 million, will be used to repay debts and fund the proposed acquisition of all units of North Gem Trust (NG Trust), the manager said. The remaining 1.4 per cent or S$6.1 million will be used to pay other fees related to the fundraising exercise.

NG Trust is a private trust that holds the interests in the South Wing of Northpoint City – which FCT’s manager has entered into an agreement, with FCL Amber and Bright Bloom Capital, to acquire for around S$1.2 billion.

The private placement initially targeted to raise S$200 million but was upsized to S$220 million as it drew strong demand from new and existing institutional, accredited and other investors, the manager said.

SEE ALSO

Frasers Centrepoint Trust to buy rest of Northpoint City for S$1.17 billion

The preferential offering is set to open on Apr 8 at 9 am, with a total of 98.2 million preferential offering units to be issued on the basis of 54 preferential offering units for every 1,000 existing units held as at 5 pm on Apr 3. This offering is expected to raise S$201.3 million.

Its S$2.05 issue price represents a discount of 7.4 per cent to the VWAP of S$2.2136 apiece and, for illustrative purposes, of 4.7 per cent to the adjusted VWAP of S$2.1521 apiece.

The counter ended Monday flat at S$2.21, before it called for a trading halt on Tuesday morning.

The halt was lifted on Wednesday morning. Following that, FCT units were down S$0.05 or 2.3 per cent at S$2.16 during the midday trading break.