Mapletree Logistics Trust - OCBC Investment 2016-06-29: Proposed acquisition in Shah Alam, Malaysia

MAPLETREE LOGISTICS TRUST M44U.SI

Mapletree Logistics Trust: Proposed acquisition in Shah Alam, Malaysia

Mapletree Logistics Trust (MLT) announced last evening that it has proposed to acquire a warehouse facility (Mapletree Shah Alam Logistics Park) in Shah Alam, Malaysia, from its sponsor Mapletree Investments Pte Ltd, for a purchase consideration of MYR160m (~S$53.2m). This comes in lower than the MYR173m average valuation on the property provided by two independent valuers.

Mapletree Shah Alam Logistics Park consists of three single-storey blocks of multi-tenanted logistics and warehousing facility with mezzanine offices attached. It is fully leased to international 3PLs including XPO Worldwide Logistics, Pantos Logistics and YCH DistriPark. The leases have a WALE of 1.7 years (by NLA).
MLT expects the property to contribute an initial NPI yield of 7.5% and will fund the purchase by proceeds raised from its recent issuance of S$250m of perpetual securities.
Completion is estimated to take place by Nov this year.
We maintain our HOLD rating and S$1.02 fair value on the stock.

Wong Teck Ching Andy CFA OCBC Securities | http://www.ocbcresearch.com/ 2016-06-29

OCBC Securities SGX Stock Analyst Report HOLD Maintain HOLD 1.02 Same 1.02