Mapletree Logistics Trust prices S$400m perps at 3.725%; redeems 4.18% perps

MAPLETREE Logistics Trust's (MLT) trustee will issue S$400 million of fixed-rate subordinated perpetual securities at 3.725 per cent, just as it looks to redeem all outstanding 4.18 per cent perps.

Net proceeds from the issue of the Series 004 perps will be used for general corporate and working capital purposes. This includes refinancing its 4.18 per cent subordinated perps and funding committed acquisitions, the real estate investment trust's (Reit) manager said on Tuesday night (Oct 27).

In a separate bourse filing on Tuesday, MLT's manager said the trustee will redeem all outstanding 4.18 per cent perps at par on Nov 25. The issuer had priced S$250 million of such perps.

The new Series 004 perps, which fall under the Reit's S$3 billion euro medium-term securities programme, will be issued at par on Nov 2 and listed on the Singapore Exchange on or about Nov 3.

The distribution will be payable semi-annually in arrear starting from May 2, 2022, and occurring on May 2 and Nov 2 of each year.

The issuer may opt to redeem the perps on Nov 2, 2026 - the first reset date, or on any distribution date thereafter. As they are perpetual, these securities have no fixed final redemption date.

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The reset rate of distribution will be a rate equivalent to the Singapore Overnight Rate Average Overnight Indexed Swap rate plus the initial spread of 2.485 per cent.

The perps are also expected to be rated BBB- by Fitch, the manager said. In addition, DBS and OCBC have been appointed joint lead managers and bookrunners for the issuance.

On Tuesday, MLT posted a 19.2 per cent year-on-year rise in its distributable income to S$93.4 million in the second quarter. Its distribution per unit grew 5.7 per cent to 2.173 Singapore cents, despite having an enlarged unit base due to the equity fundraising completed in Q3 last year.

Its weighted average borrowing cost was unchanged at 2.2 per cent per annum, with the aggregate leverage standing at 38.2 per cent as at end-September.

Available credit facilities on hand also showed that the trust has more than sufficient liquidity to meet its maturing debt obligations in this financial year FY2022, the manager said.

It noted that total acquisition value for FY21/22 ended March 2022 is expected to be "substantial" as the Reit seeks to continue fuelling its growth. Apart from assets in China, Vietnam and Malaysia from its sponsor's pipeline, the Reit is also looking to acquire properties in Japan, Australia and Korea.

The past few months have seen MLT announcing plans to acquire logistics facilities located in South Korea and Malaysia, as well as a cold-storage facility in Melbourne. MLT was also granted an option in July this year to buy a warehouse building in Changi.

MLT units rose one cent to S$2.01 on Oct 27 when market closed.