Hot stock: Lendlease Reit hits 9-month low on S$648.8m equity fundraising

UNITS of Lendlease Global Commercial Reit fell as much as 5 per cent after resuming trading on Wednesday (Mar 21).

The manager had announced a private placement and preferential offering on Tuesday - proceeds of which would help finance the real estate investment trust's (Reit) S$2.1 billion acquisition of the remaining stake in Jem mall that it does not already own.

The counter dropped to a low of S$0.755 on Wednesday morning, down 5 per cent or S$0.04 as at 9.01 am. The last time the counter closed near this level was May 31, 2021 at S$0.76.

By 11.06 am, Lendlease Reit units were down 4.4 per cent or S$0.035 to S$0.76. The Reit was also the third most traded by volume on the Singapore bourse at the time, with 26.5 million units changing hands.

In a bourse filing on Wednesday, the Reit's manager said the private placement was 3.3 times subscribed. The upsized option was also exercised, bringing the total amount raised via the private placement to S$400 million for the issue of 551.7 million new units.

Together with the preferential offering, where a total of 345.6 million units will be issued at S$0.72 apiece, the total amount raised in the equity fundraising exercise will be about S$648.8 million.

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The private placement was priced at S$0.725, the lower end of its S$0.725 and S$0.74 issue price range, representing a 9 per cent discount to the Reit's volume-weighted average price of S$0.7964 per unit on Mar 21 - before the equity fundraising was announced.

The manager expects the private placement units to be issued on or around Mar 31, 2022.

READ MORE:

• Lendlease Reit private placement 3.3 times subscribed; priced at S$0.725 per unit

• Lendlease Reit to raise at least S$573.8m to fund Jem acquisition

• Brokers' take: UOBKH and CGS-CIMB positive on Lendlease Reit's acquisition of Jem

• Lendlease Reit to acquire remaining interest in Jem mall at S$2.08b agreed property value