SINGAPORE - Frasers Centrepoint Trust (FCT) has entered into agreements to acquire a 17.1 per cent stake in PGIM Real Estate Asia Retail Fund Ltd for about $342.5 million, subject to determination of the dividend amount payable in respect of the sale shares for the fourth quarter of 2018.
FCT's wholly owned subsidiary, FCT Holdings (Sigma), has entered into 12 agreements with certain shareholders of the fund to purchase 90,346 shares, representing a 17.1312 per cent stake in the fund, said FCT's trust manager in a regulatory filing on Thursday (Feb 28).
FCT's manager said that the open-end fund is the largest non-listed retail mall fund in Singapore. It owns and manages six retail malls in Singapore - Tiong Bahru Plaza, White Sands, Liang Court, Hougang Mall, Century Square and Tampines 1 - and office property Central Plaza, as well as four retail malls in Malaysia.
The fund manager is the property investment business of PGIM, the global investment management arm of New York Stock Exchange-listed Prudential Financial Inc.
As at Dec 31, the book value and net asset value of the sale shares amounted to about $341.7 million, which included the fourth-quarter 2018 dividend.
FCT's manager intends to finance the acquisition with a combination of debt and equity financing, as well as bridging loan facilities if needed.
Among other things, completion of the acquisition is conditional upon consent from the Bermuda Monetary Authority, and board approval from the fund.
FCT unitholders can expect to enjoy higher distribution per unit as a result of the acquisition being made at a price which is reflective of the cash flows the bought shares are expected to generate, combined with a debt and equity financing plan, said the trust manager.
As at 10.39am on Thursday, FCT units were down one cent at $2.29.
This agreement is separate from a similar deal announced on Feb 18 by Frasers Property. Frasers Property to acquire a 17.8 per cent stake in the same PGIM Real Estate Fund from a single shareholder for $356.4 million.