Shareholders vote in favour of CapitaLand's acquisition of ASB

CAPITALAND'S proposed deal to acquire Ascendas-Singbridge (ASB) from Temasek Holdings got the green light from independent shareholders at an Extraordinary General Meeting (EGM) held at The Star Vista on Friday. 

The property developer is paying Temasek Holdings nearly S$6.04 billion for industrial and commercial real estate player ASB, although the deal has an enterprise value of about S$11 billion when taking into account some S$5 billion in debt owed by ASB. Half of the S$6.04 billion will be paid in cash, while the balance S$3.017 billion will be paid in new shares at S$3.50 per share. 

CapitaLand's president and group chief executive officer Lee Chee Koon said: "The transaction will strengthen and position us for the future. With the combined entity, we will be able to attract the best people. We will also have a lot more access to capital partners, markets and asset classes. We will continue to grow the company, invest right and protect the wealth that shareholders have invested in us. This marks a significant milestone as we write a new chapter of growth for CapitaLand."

During Friday's EGM, independent shareholders raised concerns over the dilution to CapitaLand's net asset value (NAV) as well as queried how the property giant planned to reduce gearing of the enlarged entity going forward.

Post-acquisition, CapitaLand's earnings per share will edge up slightly to 43.1 Singapore cents from 42.1 cents, while return on equity will go up from 9.35 per cent to 9.78 per cent. However, NAV per share will go down 4.2 per cent from S$4.55 to S$4.36.

CapitaLand's management believes the enlarged entity will be able to accelerate NAV growth from avenues such as unlocking rejuvenation opportunities in Singapore, better prospects in China as well as from potential growth in India, where ASB has made strides. Over 2,000 CapitaLand shareholders and proxies attended the EGM on Friday. Three inter-conditional resolutions were put to the vote at the EGM and passed, with resolutions relating to the proposed transaction and the proposed allotment and issuance of shares receiving 99.17 per cent and 97.82 per cent of the total number of votes respectively.

A whitewash resolution - which results in a waiver by shareholders to receive a mandatory general offer from Temasek for the shares it does not own in CapitaLand - received 91.54 per cent of total votes.