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SPH Reit's private placement raises S$164.5m

Singapore

SPH Reit has raised S$164.5 million from a private placement of 156.6 million new units to partially fund its proposed acquisition of a 50 per cent stake in a shopping centre in South Australia.

The issue price was fixed at S$1.05 per new unit - which falls in the middle of the indicative range of between S$1.031 and S$1.075 per unit announced by the manager on Thursday. It represents a discount of about 5.5 per cent to the volume-weighted average price (VWAP) of S$1.111 of all trades done on Nov 20 - the market day before the placement agreement was signed.

It also represents a discount of around 4.3 per cent to the adjusted VWAP - which subtracts the estimated cumulative distribution of around 1.39 Singapore cents, the midpoint of an estimated range of between 1.37 cents and 1.41 cents per unit.

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SPH Reit, whose sponsor is Singapore Press Holdings, which publishes The Business Times, said the placement was "multiple times covered" and drew strong participation from new and existing institutional investors.

Around S$162.4 million or 98.7 per cent of gross proceeds will be used to partially fund the proposed acquisition of Westfield Marion Shopping Centre - in which SPH Reit is planning to buy a 50 per cent stake for A$670 million (S$627.9 million).

Some S$2.1 million or 1.3 per cent of the gross proceeds will be used to pay estimated fees and expenses in connection with the proposed acquisition and the private placement. Any balance of gross proceeds will be used for general corporate or working capital purposes.

The joint lead managers and underwriters for the private placement are Credit Suisse (Singapore), HSBC (Singapore branch) and OCBC Bank.

The new units are expected to be listed on Dec 2.

SPH Reit units closed at S$1.08 on Friday, down three cents, or 2.7 per cent.