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Manulife US Reit recapitalisation: Placement of new units to Mirae should be priced at NAV

This would limit the dilutive impact on existing unitholders, and demonstrate Mirae’s credibility as a sponsor

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Ben Paul

Ben Paul

Published Mon, May 22, 2023 · 05:50 AM
    • Manulife US Reit's office properties have declined in value, and its gearing is bumping up against the statutory ceiling of 50 per cent.
    • Manulife US Reit's office properties have declined in value, and its gearing is bumping up against the statutory ceiling of 50 per cent. PHOTO: BT FILE

    DeeperDive is a beta AI feature. Refer to full articles for the facts.

    THE terms of Manulife US Reit’s much-anticipated rescue by Mirae Asset Global Investments could be unveiled in just a few weeks.

    A firm deal could well trigger a snap-back in the market price of the US office real estate investment trust’s (Reit) units. But the scale of any rebound – and the extent to which investor confidence recovers – will probably depend on how much dilution the deal inflicts on unitholders.

    The manager of Manulife US Reit said in its Q1 2023 operational update on May 11 that due diligence related to the transaction with Mirae had been substantially completed, and that the key terms were in the process of being negotiated.

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