Straits Trading unit to acquire JL Family Office's 10% stake in Straits Real Estate

SINGAPORE (THE BUSINESS TIMES) - A subsidiary of The Straits Trading Company is set to acquire JL Family Office's (JLFO) 10 per cent stake in Straits Real Estate (SRE) for S$105 million in cash, the mainboard-listed investment company said in an exchange filing on Monday.

The share sale and purchase agreement is between STC Capital, Straits Trading's wholly-owned subsidiary, and JL Equity II, a unit of the JLFO.

The acquisition comes as JLFO seeks to divest its stake in SRE at the end of its successful investment cycle, Straits Trading said in a statement.

The transaction is scheduled to complete on April 9 and it will be fully funded by Straits Trading Co's internal cash resources, the company said.

This means SRE will become a fully-owned subsidiary of the group following the transaction.

"The acquisition represents a material investment in one of Straits Trading's key business units, providing shareholders with enhanced long-term growth prospects and capital returns," said Chew Gek Khim, executive chairman of Straits Trading.

It is also earnings per share-accretive for the group on a pro forma basis for financial year 2020, the company said.

SRE's diversified investment portfolio spans six countries and various property asset classes, Straits Trading said.

The company added that it has been increasing its exposure to "future-ready and resilient sectors" such as modern logistics and business parks.

Andy Lim, group chief executive of JLFO, said the investment holding group and Straits Trading built SRE together since 2013 and they are pleased that all stakeholders have benefited from its growth.

"We have enjoyed our working relationship with Straits Trading immensely and look forward to continuing our collaboration on future projects through our real estate unit The Land Managers," Mr Lim said.

Straits Trading shares rose one Singapore cent, or 0.35 per cent to close at S$2.85 on Monday.