Ascott Residence Trust’s private placement closes at S$1.12 per stapled security

ASCOTT Residence Trust (ART) has closed its private placement at S$1.12 per stapled security to raise S$170 million, the stapled hospitality group’s managers announced on Tuesday (Aug 16) before the market open.

ART had launched the placement on Monday to raise S$150 million, part of which would be used to acquire 9 serviced residences, rental housing and student accommodation properties from its sponsor. The trust has since exercised the upsize option to raise an additional S$20 million.

The issue price represents a 4.5 per cent discount to ART’s volume-weighted average price of S$1.1733 per stapled security. Some 151.8 million new stapled securities will be issued to raise the S$170 million in gross proceeds.

“The private placement was oversubscribed, including the upsize option, and drew strong demand from new and existing stapled securityholders, long only funds, private wealth, multi-strategy investors and other accredited investors,” the trust’s managers said in the filing. The placement was about 2.7 times covered.

Of the S$170 million in proceeds, ART will use S$122.3 million to partly fund its purchase of interests in serviced residence properties in France, Vietnam and Australia, rental housing properties in Japan and a student accommodation property in South Carolina, the US.

Another S$45.1 million will be used to partially fund any potential future acquisitions, while S$2.6 million will go towards professional fees and other expenses for the placement.

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Ascott Trust plans to buy 9 overseas properties; launches private placement to raise S$150m

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ART was trading at S$1.14, down 3.4 per cent or S$0.04, as of 3.44pm on Tuesday.