ARA Asset Management founder and group chief executive John Lim is leading a group of investors in a bid to take ARA private.
The consortium involves existing shareholders - Mr Lim, the Straits Trading Company and Cheung Kong Property Holdings - and two new partners, American private equity firm Warburg Pincus and China's Avic Trust.
Straits Trading, Cheung Kong and Mr Lim already hold a combined 46.24 per cent of ARA.
The buyout move involves the consortium offering minority shareholders cash of $1.78 for each ARA share, a deal that values the company at $1.775 billion.
The offer price represents a premium of 43.9 per cent over the 12-month, volume-weighted average price up to and including Nov 2.
ARA shares last traded at $1.495 last Thursday, jumping 8.5 cents, or 6 per cent before a trading halt was called. Trading resumes today.
Less than 54 per cent of ARA is held in public hands.
If the acquisition goes through, Warburg Pincus will become the largest shareholder in ARA, with a 30.72 per cent stake, followed by Avic Trust, with a 20.48 per cent stake.
This will leave Mr Lim's JL Investment Group with 19.85 per cent, while Straits Trading Company will hold 20.95 per cent and Cheung Kong Property 8 per cent.
ARA said in a statement that it was partnering Warburg Pincus and Avic Trust to boost its access to capital, which will allow it to operate "more nimbly".
Mr Lim said in a statement: "A deeper capital base well positions ARA in executing its business strategies going forward, including tapping growth opportunities through the network of our new partners."
Ms Chew Gek Khim, executive chairman of Straits Trading, said: "Given their (Warburg Pincus and Avic Trust) deep experience and wide network of business relationships in the China region, we believe they will create value and opportunities to support ARA's future growth."
Avic Trust is owned by OCBC and the finance arm of the Aviation Industry Corporation of China.
The buyout will be carried out by way of a scheme of arrangement.
This means that the offeror will hold a scheme meeting where it needs more than 50 per cent of shareholders present in person or by proxy to vote "yes" to the scheme.
These shareholders will also have to hold at least 75 per cent of the value of total shares held by all at the meeting. Members of the acquiring consortium will not vote.
The scheme is expected to be completed in the first half of next year, and will not trigger any takeover offer for any publicly-listed Reits managed or owned by ARA.
ARA's independent directors have appointed Deloitte & Touche as the independent financial adviser to guide shareholders on whether to accept the scheme.
Meanwhile, ARA reported an 84 per cent jump in net profit to $31.5 million in the third quarter from the same period a year ago, due mainly to higher distribution income from units of Suntec Reit accumulated, as well as from its investment in private real estate funds.
Revenue in the three months ended Sept 30 climbed 39 per cent to $53 million, it reported yesterday.
Third-quarter earnings per share was 3.16 cents, up from a restated 1.97 cents in the same quarter last year.
Net asset value per share was 56.2 cents as at Sept 30, up from 52.17 cents as at Dec 31 last year.
ARA had $30 billion assets under management (AUM) as at Sept 30.
The investment in Century Link, announced on Oct 26 and which will be completed by next month, will add another $4.1 billion to the group's AUM.
ARA, which was founded in 2002 by Mr Lim with the backing of Hong Kong billionaire Li Ka Shing, was listed in 2007.
