Saizen Reit to sell all Japan assets to Triangle TMK for 44.7b yen

THE manager of Saizen Reit (real estate investment trust) said a 44.66 billion yen (S$518.3 million) offer by Triangle TMK to acquire all of Saizen Reit's real-estate assets in Japan has been accepted.

The trust's manager, Japan Residential Assets Manager, said HSBC Institutional Trust Services (Singapore) had, in its capacity as trustee of Saizen Reit, accepted the offer on Saturday.

The deal is at a 3.4 per cent premium to the appraised value of the Japanese properties.

The purchase consideration is estimated to translate into an implied net offer price of S$1.172 per unit of Saizen Reit, or a slight premium to Saizen Reit's adjusted net asset value per unit, based on audited figures as at June 30, 2015, after taking into account estimated transaction-related costs and expenses.

The estimated implied net offer price of S$1.172 per unit represents a 36.9 per cent premium above the closing price of S$0.855 per unit on Oct 22, being the day immediately prior to the manager's announcement of the offer, and a 40.9 per cent premium above the one-month volume-weighted average price per unit as at Oct 22.

The trust's manager on Saturday said it intends to distribute the net proceeds from the proposed deal to Saizen Reit's unitholders "as soon as practicable", via special distribution(s).

Details on this will be made known later.

The proposed transaction is conditional upon, among other things, approval from unitholders at an extraordinary general meeting of Saizen Reit to be convened and is expected to be completed in the first quarter of 2016 and no later than end-March 2016 or such other date as the parties may agree in writing.

Credit Suisse (Singapore) and NorthEast Capital Management GK acted as joint financial advisers to the independent evaluation committee of the manager on this.

Triangle TMK is a Japanese affiliate of Lone Star Real Estate Fund IV and Lone Star Funds.

Lone Star Funds is a leading private equity firm that invests globally in real estate, equity, credit and other financial assets. Since the establishment of its first fund in 1995, Lone Star Funds has organised 15 private equity funds with aggregate capital commitments totalling some US$60 billion.