For $523.1 million, its sponsor Frasers Property is selling a further 24.5% effective interest in the retail center Nex at Serangoon Central to Frasers Centrepoint Trust (FCT).
According to the statement on January 25, Nex at Serangoon Central, the largest suburban mall in Singapore’s northeast by net lettable space, will be valued at $2.13 billion as a result of the transaction.
“The acquisition follows from our initial acquisition of 25.5% in Nex in February 2023 and will raise FCT’s effective interest to 50% upon completion,” stated Mr. Richard Ng, chief executive of FCT’s manager.
Mr. Ng stated that Nex is a strategic fit for FCT’s premium suburban retail portfolio and that it is an exceptional asset with great financial and operational performance. The transaction is also expected to increase distribution per unit.
The majority of the suburban shopping centers in FCT’s portfolio are Causeway Point and Northpoint City’s North Wing.
The manager also emphasized that unitholders must approve the proposed acquisition at an extraordinary general meeting, the date of which will be announced later.
FCT’s manager suggested a private placement in a different filing that same day, aiming to generate at least $200 million to partially finance the acquisition. The issue price of the units would range from $2.16 to $2.204.
Regarding the adjusted volume-weighted average price of $2.2446 per unit and the volume-weighted average price of $2.2871 per unit, the proposed issue price range indicates a discount of about 1.8 to 3.8 percent and 3.6 to 5.6%, respectively.
The manager stated that, after partially funding the purchase of the remaining 49% ownership in NP Trust and its trustee-manager, it plans to utilize the gross revenues to pay down current debts.
The Wall Street Journal revealed on January 10 that Frasers Property’s primary shareholders may sell the business or a portion of its holdings in order to earn money to pay off debt. On January 12, the corporation denied the reports, stating that it was “not aware” of any talks to sell the business or its assets.
