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First Reit and Lippo Mall Reit terminate deal to buy Yogyakarta development for now

FIRST Reit and Lippo Malls Indonesia Retail Trust (LMIRT) have decided to terminate a deal to buy an integrated development in Yogyakarta, Indonesia, from their sponsor PT Lippo Karawaci Tbk.

They had first announced the signing of the sale and purchase agreement in Feb 2016.

The purpose of the termination was to give more time for the vendor to carry out asset enhancement works to the retail mall component known as Lippo Plaza Jogja, as well as to obtain the relevant licences for the operation of the hospital component called Siloam Hospitals Yogyakarta (SHYG).

"For the avoidance of doubt, the parties intend to continue with the transaction on mutually agreeable terms after the asset enhancement works and after the commencement of operations of SHYG upon approval of all relevant licences, expected to be in the later part of 2017," they said.

Notwithstanding the termination of the agreement, both trusts continue to have a right of first refusal from their sponsor over the property, they added.

LMIRT finished flat at S$0.375, while First Reit rose 1.5 Singapore cent to S$1.295.

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