SINGAPORE - Mainboard-listed real estate group SingHaiyi has, in conjunction with Haiyi Holdings, subscribed for about 175.1 million units of stapled securities, or a 9.9 per cent stake, in Australia-listed Cromwell Property Group for A$169.6 million (S$172.4 million).
Haiyi Holdings is a wholly owned entity of SingHaiyi's controlling shareholders, Gordon Tang and Celine Tang.
Each unit of stapled security comprises one ordinary share in Cromwell Corporation stapled to one unit in Cromwell Diversified Property Trust. The issue price of A$0.9691 per security represents a 4.9 per cent discount to Cromwell's one-month volume weighted average price of A$1.0191 per security.
Of the total subscription, SingHaiyi will subscribe for 61 million units of stapled securities for A$59.1 million, representing a 3.45 per cent stake in Cromwell; this will be fully funded through internal cash funds.
This "marks another step in SingHaiyi's strategy to diversify its income streams and geographical exposure to provide stable and visible earnings, while delivering greater value for shareholders," said SingHaiyi in a press release.
As at June 30, 2017, Cromwell has a market capitalisation of A$1.7 billion, a direct property investment portfolio in Australia valued at A$2.3 billion, and total assets under management of A$10.1 billion across Australia, New Zealand and Europe. Cromwell is also the sponsor of Cromwell European Real Estate Investment Trust (CEReit), in which Mr and Mrs Tang are cornerstone investors with a stake of about 13.9 per cent.
Mrs Tang, SingHaiyi's group managing director, said: "We are constantly on the lookout for opportunities to grow and broaden our income streams through yield-accretive acquisitions, quality property developments and astute investments. The subscription in stapled securities of Cromwell Property Group will firmly position SingHaiyi to be a direct beneficiary of the strong growth potential of Cromwell's prime Australian commercial property assets."
She added: "The subscription will also offer SingHaiyi unprecedented exposure to Cromwell's wider portfolio of high quality income producing assets across Australia, New Zealand and Europe."