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SingHaiyi to reduce Cromwell stake to 1.6% for A$16.1 million

MAINBOARD-LISTED developer SingHaiyi Group is again paring its stake in Cromwell Property Group, with a share sale to an ARA Asset Management Holdings unit.

SingHaiyi accepted a tender offer from ARA on Monday for roughly 17.5 million stapled securities, priced at A$16.1 million (S$15.9 million), the board said in a filing.

SingHaiyi had a 2.3 per cent interest in Australian real estate investment manager Cromwell as at March 31. Its ownership will be reduced to 1.6 per cent after this transaction, which is expected to yield a disposal gain of A$2.1 million.

The SingHaiyi board said that the sale proceeds will be used to repay bank loans, which is expected to enhance the financial flexibility of the company.

SingHaiyi has accepted an offer price of A$0.92 for each stapled security, representing a premium of 14.9 per cent to the distribution-adjusted, volume-weighted average price of A$0.80 for the 30 trading days up to Aug 14, 2020.

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Last November, SingHaiyi sold three million stapled securities for A$3.96 million, or A$1.2935 apiece, to an undisclosed buyer.

Singapore-based fund manager ARA, which is Cromwell's largest shareholder, launched a takeover bid for the real estate group in June - offering to buy 29 of every 100 stapled securities that it did not already own, at A$0.90 each.

SingHaiyi shares closed up by 0.1 Singapore cent, or 1.39 per cent, to 7.3 Singapore cents on Monday, before the latest announcement.

Cromwell is the sponsor of Singapore-listed Cromwell European Reit, which ended at 0.46 euro on Monday, down by 3.16 per cent.

The management of Cromwell had previously accused ARA of being associated with SingHaiyi's controlling Tang family, but the Australian Takeovers Panel rejected an application to declare that the two parties had an association, said earlier press reports.

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