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This Part of the placement will fund a warehouse’s acquisition in Jurong and repay existing debt.
ESR-REIT is set to issue around 194.2 million new units under an upsized private placement to raise $100 million in gross proceeds, reported The Business Times.
The order book for the placement was closed on Tuesday (18 June), with the issue price fixed at 51.5 Singapore cents for each new unit.
The figure sits at the lower end of the 51.5 to 52.5 cents range announced earlier by the trust. The issue price represents an 8.3 percent discount to the volume weighted average price of 56.16 cents per unit for trades conducted on 14 June.
Based on the $100 million gross proceeds, the private placement was about 2.5 times covered, with “strong participation” from existing and new institutional and other investors, said ESR-REIT’s manager.
The upsize option, to increase gross proceeds to $100 million from $75 million, was exercised in full.
The placement forms part of an equity fundraising, which also includes a preferential offering, to fund the trust’s acquisition of a warehouse in Jurong, asset enhancement works at two of its existing assets and to repay existing debt.
The manager revealed that it has no plans of raising total gross proceeds from the private placement and preferential offering to over $150 million.
Of the $150 million proceeds, around $45.7 million will be used to fund the asset enhancement works at Changi and Ang Mo Kio, while $44.4 million will be set aside for the warehouse acquisition.
Meanwhile, some $56.8 million will be used to repay existing debts of the trust and $3.1 million will be used to cover transaction-related expenses.
Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg
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