Consortium of investors eyes ARA Asset Management buyout

ARA Asset Management founder John Lim owns 19 per cent of the company. ARA, which was listed on SGX in November 2007, manages $30 billion in Asian property assets. The buyout consortium reportedly includes US private equity firm Warburg Pincus.
ARA Asset Management founder John Lim owns 19 per cent of the company. ARA, which was listed on SGX in November 2007, manages $30 billion in Asian property assets. The buyout consortium reportedly includes US private equity firm Warburg Pincus.PHOTO: ARA ASSET MANAGEMENT

ARA founder said to be leading group, which includes existing shareholders and US firm

Singapore-listed ARA Asset Management, worth around $1.4 billion, looks poised to be next on the buyout list here.

A group of investors, including founder John Lim, is said to be targeting the firm, which manages real estate investment trusts (Reits), and other real estate funds.

Mr Lim, who owns 19 per cent of the company, will reportedly lead the buyout consortium, The Wall Street Journal said yesterday, citing sources familiar with the matter.

Other investors will include existing shareholders as well as United States private equity firm Warburg Pincus.

Reuters reported that the buyout attempt could be announced as early as next week.

The possible bid follows a series of buyout offers. On Thursday, Singapore Exchange (SGX)-listed Super Group got a $1.45 billion buyout offer from a Dutch beverage giant.

  • $1.4b Market capitalisation of ARA Asset Management

ARA Asset Management declined to comment when contacted by The Straits Times yesterday.

It added: "There will be further updates from the company through the SGXNet announcement."

ARA Asset Management, which was listed on SGX in November 2007, manages $30 billion in Asian property assets.

It focuses on a diverse range of Reits and private real estate funds that are invested in the office, retail, logistics and industrial, hospitality and residential sectors in the Asia-Pacific.

Trade in shares of ARA Asset Management, which has a market capitalisation of $1.4 billion, was halted on Thursday, pending an announcement.

The trading halt came after the Singapore Exchange queried the firm about unusual trading activity in its units.

The counter rose by 8.5 cents, or 6.03 per cent, to $1.495 a unit on Thursday before the halt in trading was called.

According to the firm's website, The Straits Trading Company is the largest shareholder in ARA Asset Management with a 20.1 per cent stake as at July 25. Straits Trading called for a halt in trading of its shares yesterday afternoon.

Franklin Resources had about 11 per cent, Matthews International Capital Management held about 9.6 per cent of the total shares, 7.8 per cent was held by Cheung Kong Property Holdings and 32.4 per cent by other investors.

ARA Asset Management will be announcing its earnings for the third quarter ended Sept 30 next Tuesday after the close of trading.

It reported a 9 per cent lift in net profit for the first half to $38.7 million, while revenue rose 10 per cent to $81.6 million. The firm attributed the better showing on strong growth in fees from managing Reits and investment portfolios.

Last month, it said it had established the ARA Harmony VI fund to invest in Century Link, a $4.1-billion premium-grade integrated commercial property in Shanghai.

The firm had said that the investment in the Chinese commercial property would be the biggest single-asset property transaction in the Asia-Pacific this year.

A version of this article appeared in the print edition of The Straits Times on November 05, 2016, with the headline 'Consortium of investors eyes ARA Asset Management buyout'. Print Edition | Subscribe