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CapitaLand, Ascendas-Singbridge in S$11b deal to form Asia's largest real estate group
CapitaLand is acquiring Temasek’s subsidiary, Ascendas-Singbridge Pte Ltd (ASB) to create the largest diversified real estate group in Asia in a deal valued at S$11 billion.
Under the terms of the agreement, Temasek will receive S$6 billion, half in cash to be funded by debt, and half in new CapitaLand shares, according to a company statement Monday (14 January).
The 862.3 million new CapitaLand shares will be priced at S$3.50 each, representing a premium of 7 percent over its last traded share price of S$3.27, and 11.3 per cent over its one-month volume weighted average price of S$3.1447. The consideration takes into account the adjusted net asset value of ASB, which includes the value of its fund management platform and the trading value of its three sponsored listed trusts.
CapitaLand and Ascendas-Singbridge have a combined enterprise value of around S$10.9 billion, comprising S$6.1 billion of equity value and S$4.9 billion of net debt and minority interest. The deal is expected to be completed by the third quarter.
Upon completion, Temasek’s ownership of CapitaLand will increase to about 51 per cent from 40.8 per cent. The combined total assets under management (AUM) of the group will exceed S$116 billion, helping CapitaLand to achieve its 2020 AUM target of $100 billion, and placing it among the top 10 global real estate investment mangers The expanded asset classes will include logistics/business parks, industrial, lodging, commercial, retail and residential.
“This transaction represents a compelling opportunity to realise benefits not available to each company on a standalone basis; we will have more opportunities to create enhanced value for our shareholders,” Ng Kee Choe, Chairman of the board of CapitaLand said.
Headquartered in Singapore, ASB’s business presence spans 11 countries including Singapore, China, India, Australia, the UK and the US. Over 80 per cent of ASB’s S$23.6 billion AUM is in business spaces. Its flagship projects include Singapore Science Park and Changi Business Park in Singapore, International Tech Park Bangalore and International Tech Park Chennai in India, as well as Dalian Ascendas IT Park and Singapore Hangzhou Science and Tech Park in China.
ASB has interests in and also manages three listed trusts, namely Ascendas Reit, Ascendas India Trust and Ascendas Hospitality Trust, which comprises a portfolio of 14 hotels in Australia, Korea, Japan and Singapore.
The proposed transaction is subject to approval by CapitaLand’s independent shareholders at an extraordinary general meeting expected the first half of this year.
J.P. Morgan (S.E.A.) Limited and WongPartnership LLP are acting as sole financial advisor and legal counsel to CapitaLand respectively. Allen & Gledhill LLP is acting as legal counsel to ASB.
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