The Business Times
HOCK LOCK SIEW
·
SUBSCRIBERS

S-Reit mergers have mostly been value destructive

Unusual circumstances may be partly to blame, but purported benefits of revenue enhancement and DPU boosts have also not materialised

Published Thu, Apr 15, 2021 · 05:50 AM

ONE plus one has been less than two for most Singapore real estate investment trust (S-Reit) mergers, despite the promises of synergistic benefits and cost savings managers have dangled before unitholders when rallying them to vote for such deals.

This debunks the "bigger is better" adage that investors have been led to believe since the first Reit merger - between ESR-Reit and Viva Industrial Trust - was completed in October 2018.

Data compiled by The Business Times shows the acquirer's (or combined entity's) share price and total returns for most of the five successful Reit mergers disappointing over time.

KEYWORDS IN THIS ARTICLE

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to  t.me/BizTimes

Reits & Property

SUPPORT SOUTH-EAST ASIA'S LEADING FINANCIAL DAILY

Get the latest coverage and full access to all BT premium content.

SUBSCRIBE NOW

Browse corporate subscription here