Ascott Residence Trust's private placement priced at bottom end of price range

ASCOTT Residence Trust (ART)'s HMN private placement closed about 2 times covered and was priced at the bottom end of its price range at 98.3 Singapore cents per new stapled security.

The private placement saw participation from new and existing institutional and other accredited investors, the managers of the real estate investment trust (Reit) said in a bourse filing on Friday.

Its issue price represents a 5.5 per cent discount to the volume-weighted average price (VWAP) of S$1.04 per stapled security and 5 per cent discount to the adjusted VWAP of S$1.034 per stapled security based on trades in ART's stapled securities on Sept 8 up to the time the placement agreement was signed on Sept 9.

The private placement raises gross proceeds of S$150 million. The managers on Thursday said about S$58.7 million or 39.1 per cent of the gross proceeds will go towards partially funding its acquisition of a Texas student housing asset, while S$89 million or 59.4 per cent will be used to partially fund future potential acquisitions.

The remaining S$2.3 million or 1.5 per cent will be used to pay the estimated professional and other fees and expenses in connection with the private placement.

The Reit's managers previously said the private placement will be targeted at institutional and other investors at an issue price of between 98.3 Singapore cents and S$1.014 per new stapled security.

A total of 152,594,100 new stapled securities will be issued under the private placement, and trading of the new units on the Singapore Exchange (SGX) is expected to commence on Sept 20 at 9am.

The counter closed flat at S$1.04 on Wednesday, before it called for a trading halt on Thursday morning. Units of ART will resume trading on Friday.

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