Frasers Centrepoint eyes 40% stake in Thai property firm

Proposed $519m deal in line with overseas expansion strategy, says S'pore player

Developer Frasers Centrepoint (FCL) is proposing to invest 13.23 billion baht (S$519 million) to take a major stake in a Thai property firm.

The deal, which would be the biggest in the real estate sector by a Singapore player this year, involves FCL buying 40 per cent of Ticon Industrial Connection Public Company.

FCL said that buying the stake in Ticon - which owns and manages about 2.5 million sq m of industrial space including factories and warehouses - is in line with its strategy of expanding overseas.

FCL group chief executive Panote Sirivadhanabhakdi said in a statement: "Thailand is one of FCL's selected secondary markets which we believe offers growth prospects."

FCL's wholly owned unit, Frasers Property Holdings, plans to invest in Bangkok-listed Ticon via a private placement at a subscription price of 18 baht a share. This is a premium of 5.9 per cent to Ticon's last closing price on Oct 3, and 13.6 per cent over its 30-day volume weighted average price.

When the transaction is completed, Frasers Property Holdings will hold around 40 per cent of Ticon's enlarged share capital.

FCL already has investments in Thai residential and commercial property via its stake in Golden Land Property Development.

The Ticon investment would extend that to industrial property and increase income from overseas.

FCL added that Thailand's industrial and logistics sectors are poised for strong and long-term growth, given that the government is planning a roll-out of infrastructure investment programmes worth US$98 billion (S$135 billion).

Ticon has built factories and warehouses in 18 industrial estates and 33 logistics locations in Thailand. It also sponsors three listed property funds and a listed real estate investment trust in Thailand, with combined assets under management of approximately 32.4 billion baht.

The deal would be FCL's largest since its Frasers Hospitality unit acquired the Malmaison Hotel du Vin group of hotels for £363.4 million (S$621 million) last year.

At home, the firm is working towards the launch of a private condominium in Siglap Road next year, the site of which it acquired jointly in January. Also, a spokesman said in an e-mail yesterday that the firm has completed renovations at The Centrepoint, with shops expected to open from this quarter.

A version of this article appeared in the print edition of The Straits Times on October 11, 2016, with the headline 'Frasers Centrepoint eyes 40% stake in Thai property firm'. Print Edition | Subscribe