Keppel Reit to raise $119.7m through placement of new units

Keppel Reit is seeking to raise funds for the acquisition of 8 Exhibition Street building (above) in Australia by selling new units in the trust. -- PHOTO: KEPPEL CORPORATION LIMITED
Keppel Reit is seeking to raise funds for the acquisition of 8 Exhibition Street building (above) in Australia by selling new units in the trust. -- PHOTO: KEPPEL CORPORATION LIMITED

Keppel Reit is seeking to raise funds for the acquisition of an office building in Australia by selling new units in the trust.

It will place 95 million new units to institutional and other investors at $1.26 apiece, raising gross proceeds of $119.7 million, Keppel Reit Management, the trust's manager, said on Friday.

After deducting placement fees, the net proceeds will amount to about $118.3 million, it added.

This will be used to pay for the 50 per cent stake in 8 Exhibition Street, a Melbourne office building, that Keppel announced it would buy last month.

The placement will increase the total number of issued units in the trust by 3.5 per cent. On a pro forma basis, the Reit's aggregate leverage ratio will be reduced from 44.2 per cent to 43.9 per cent, based on its unaudited financial results as at June 30.

Keppel Reit units were halted from trading on Friday morning pending the announcement. The counter closed down 1 cent to $1.305 on Thursday.