Stocks In Focus SG (ARA Asset Mgt, Cambridge Industrial Trust, Swissco Hldgs) – 23/12/13

ARA Makes Inroad Into South Korea

• ARA Asset Management agreed to acquire Macquarie Real Estate Korea, a real estate management company based in Seoul, South Korea, for a purchase consideration which was not available when the news was announced.

• The South Korean company manages two privately held Korean real estate investment trusts (REIT) with combined assets under management (AUM) valued at KRW588.4 billion (approximately $700 million).

• As part of the acquisition, ARA will also acquire a 10.02 percent equity interest in one of the Korean REITs, co-investing alongside one of Korea’s largest pension funds who is also the sole investor in the second Korean REIT.

Significance: The acquisition allows ARA’s current REITs management platform to gain a foothold in South Korea, enabling the company to capitalise on the growing real estate opportunities in Asia’s fourth largest economy by gross domestic product. ARA’s AUM as at 30 September 2013 was $23.4 billion.

CIT To Acquire Industrial Building In Redhill

• Cambridge Industrial Trust (CIT) agreed to acquire a 6-storey warehouse cum light industrial building, with a gross floor area of 9,062 square metres and remaining land tenure of 43 years, for a purchase consideration of $32.4 million.

• Located at 11 Chang Charn Road which is along Hoy Fatt Road, the property is within five minutes of walking distance from Redhill MRT station, 10 minutes of driving distance from Central Business District and well connected by major roads and expressways.

• The acquisition will be financed through the use of both cash and existing debt facilities.

Significance: CITbelieves that the property is a well-located and good-quality industrial asset that will potentially enhance its overall portfolio in light of rental and capital upside driven by the renewal and remixing of tenancies over the next one to two years.

Swissco Bags $15.2m Worth Of Chartering Contracts

• Swissco Holdings secured three charter contracts for an aggregate amount of $15.2 million.

• The first contract with an exercisable purchase option after the chartering period, involves deploying an offshore support vessel (OSV) in the Middle-East for three years.

• The second and third contracts which are short-term charter contracts will deploy two accommodation vessels in different work sites in Southeast Asia. Deployment duration for the first vessel with an option to extend will be 30 days, while the other vessel will be deployed for a period of six months.

Significance: Swissco expects to further benefit from the robust demand for OSVs on the back of healthy activities in the oil and gas sector, as it continues to develop its chartering services segment.

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• Asia Daily Bulletin – 27/12/13