Keppel Reit unit obtains 131 billion won loan facility
Conditions of the loan facility include Keppel Reit’s manager staying on in its role, among other terms
A SUBSIDIARY of Keppel Real Estate Investment Trus t (Reit) has procured a loan facility of 131 billion won (S$130.1 million), guaranteed by its trustee HSBC Institutional Trust Services, said the manager of Keppel Reit on Friday (May 17).
The 131 billion won revolving credit facility was obtained by Keppel No 4 General Investors’ Private Real Estate Investment Liability Company and carries conditions related to a change in the manager or its effective shareholding, said the manager in a bourse filing.
The loan’s first condition is that Keppel Reit’s manager, Keppel Reit Management, should remain in its role.
In the event Keppel Reit Management is unable to continue as the manager of Keppel Reit, an entity wholly owned – either directly or indirectly – by Keppel Capital or Keppel must be appointed as a replacement or substitute manager, in accordance with the terms of the trust deed of Keppel Reit and applicable laws.
If the above conditions are not met and Keppel No 4 and the loan facility lender are unable to come to an agreement on the revised terms of the loan, the lender may require Keppel No 4 to pay all outstanding loans within 15 days.
The manager noted that if the lender claws back the new loan facility, it may cause a cross-default under other borrowings of Keppel Reit. The aggregate level of facilities that may be affected is close to S$2.7 billion, excluding the new loan facility, interest and fees.
Units of Keppel Reit ended S$0.005 or 0.6 per cent lower at S$0.87 on Friday, before the announcement.
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