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Due to strong demand from investors, AIMS AMP Capital Industrial REIT (AA REIT) has upsized its private equity placement to about $55 million from $50 million originally, according to an SGX filing today.
Following the launch of the exercise on Tuesday (21 November 2017), the trust has issued 42.145 million new units for $1.305 apiece, which represents a discount of 6.9 percent to its volume weighted average price of $1.402 on the same day.
The net proceeds will mainly be used to partially repay its existing loans, balance payments for recent development projects, as well as fund development opportunities and asset enhancement initiatives (AEIs).
“The private placement follows our last successful equity fundraising exercise in FY2014 and is a good opportunity for AA REIT to strengthen its balance sheet and capital structure,” said Koh Wee Lih, CEO of AIMS AMP Capital Industrial REIT Management.
“With the private placement expected to reduce AA REIT’s aggregate leverage from 37.3 percent as at 30 September 2017 to approximately 34 percent on a pro forma basis, AA REIT would have an increased debt headroom and be at a better position to capture future opportunities in the growing industrial real estate industry and deliver value for our unitholders.”
To be fair with existing unitholders, the trust intends to do an advanced distribution of undistributed income of 1.91 Singapore cents per unit for the period between 1 April to 30 September 2017. This will be done on the day immediately prior to the issuance of the new units on 1 December 2017.
Upon issuance and listing on the Singapore Exchange on that day, the new units will rank pari passu with all existing AA REIT units.
Pursuant to the placement, the trust has appointed Maybank Kim Eng Securities as the sole bookrunner and underwriter for the exercise.
This article was edited by Keshia Faculin.
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