Frasers Centrepoint, a unit of Fraser and Neave, says it’s buying 18 percent of Allco REIT and all of Allco Singapore, which manages the trust.
The deal is valued at S$180 million.
Frasers Centrepoint will rename Allco REIT to Frasers Commercial Trust when the transaction is completed.
Under the deal, Frasers Centrepoint will buy about 126 million shares in Allco REIT for 83 Singapore cents a share, a near 17 per cent premium over its last traded price on Monday.
Frasers Centrepoint will also drop its plans to list a separate commercial property trust.
Frasers Centrepoint will instead offer its current portfolio of commercial assets, worth about S$700 million, as a potential pipeline for the acquired Allco REIT.
It said the acquisition will deliver on its plan for a commercial REIT.
The company intends to list a third REIT for its serviced residence assets in the next two to three years, subject to prevailing market conditions.
Frasers Centrepoint already has a retail REIT – Frasers Centrepoint Trust, which was listed on the Singapore Exchange in 2006.
Allco REIT has a market capitalisation of S$504 million, with S$2 billion of commercial properties located in Singapore, Australia and Japan.
Source : Channel NewsAsia – 8 Jul 2008