Keppel Reit prices private placement at S$1.13 per unit

KEPPEL Reit's private placement has been priced at S$1.13 per new unit, about midway of its indicative range, its manager announced in a bourse filing late on Thursday night.

That's a 4.1 per cent discount to the real estate investment trust's (Reit) volume-weighted average price of S$1.1783 for all trades done on Wednesday.

The placement was about 4.6 times covered and saw "strong participation" from new and existing institutional, accredited and other investors, the manager said.

A total of 238.9 million new units will be issued under the private placement to raise gross proceeds of about S$270 million.

This comes after the manager on Thursday morning proposed a private placement of between 235.6 million and 242.8 million new units, at an issue price of between S$1.112 and S$1.146 per new unit. 

About S$262.5 million or 97.2 per cent of the proceeds will be used to partially fund the Reit's proposed acquisition of Keppel Bay Tower from sponsor Keppel Land, which is the property arm of Keppel Corp. Among other things, the acquisition is subject to unitholders' approval at an extraordinary general meeting scheduled for Feb 24.

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In addition, around S$4 million of the proceeds will go towards paying professional and other fees and expenses incurred in connection with the proposed acquisition, private placement and loan facilities.

The remaining S$3.5 million will be used to repay existing indebtedness and for general corporate and working capital purposes.

Trading of the new units is expected to commence on or around March 1 at 9am. This is subject to certain conditions in the placement agreement, including the receipt of in-principle approval from the Singapore Exchange for the listing of the new units on the bourse.

Following this announcement, Keppel Reit on Thursday night requested the lifting of a trading halt it called for earlier in the day before the market opened. 

As at 10.10am on Friday, Keppel Reit units were trading at S$1.14, down S$0.05 or 4.2 per cent.