Frasers Commercial Trust: Launch of private placement exercise
- Frasers Commercial Trust (FCOT) announced that it has launched a private placement exercise of 84m new units at an issue price of between S$1.46 to S$1.48.
- This is unsurprising, as FCOT had stated its intention to carry out such an exercise in its circular, which was published on 3 Jun 2015.
- FCOT had subsequently obtained approval from unitholders for this at an EGM last month.
- Depending on market conditions, FCOT may increase the size of its private placement exercise by up to an additional 12m new units.
- The issue price represents a discount of 4.9%- 3.6% to its last closing price.
- Gross proceeds of up to S$142.1m will be raised, of which S$122.7m will be utilized to partially finance its proposed A$237.7m acquisition of an office building (357 Collins Street) in Melbourne from its sponsor (unitholders’ approval also obtained).
- Based on FCOT’s projections, the transactions are expected to raise its 4QFY15 DPU by ~0.8%.
- We maintain our BUY rating and S$1.65 fair value on the stock.
(Wong Teck Ching Andy)
Source: http://www.ocbcresearch.com/
