Month: July 2010
CMMT – BT Singapore
CMA prices M’sia trust at bottom of range
CapitaMalls M’sia Trust is scheduled to list on July16
CapitaMalls Asia Ltd (CMA), owner of shopping malls in the region, said it priced shares of its Malaysian unit at the low end of its projected range, raising investor concerns that gains may be capped when trading begins.
CapitaMalls Malaysia Trust’s units were offered to institutions at RM1 apiece, while shares were sold to individual investors at 98 sen each, it said.
The RM852 million initial public offering (IPO), the second-biggest in Malaysia this year, was earlier priced at between RM1 and RM1.10 a share for large investors.
‘The upside on the capital appreciation potential can be quite limited,’ said Scott Lim, chief executive officer of MIDF Amanah Asset Management Bhd in Kuala Lumpur, which manages the equivalent of US$670 million. ‘Most of the properties inside the Reit are priced at market, they’re already at present market value and they’re not undervalued assets.’
The IPO follows the RM1.5 billion raised by Sunway Real Estate Investment Trust in its initial sale last month and underscores rising investor appetite for equities in Malaysia amid an economic rebound from last year’s recession. CapitaMalls Malaysia’s IPO may be surpassed by share sales of two units of state oil and gas company Petroliam Nasional Bhd.
Sunway Reit fell on its trading debut yesterday, closing at 88.5 sen at the midday break, from its institutional offer price of 90 sen.
‘It’s ok. These things happen,’ Jeffrey Cheah, chairman of its parent company Sunway City Bhd, told reporters in Kuala Lumpur today. ‘It’s a very difficult market. I don’t look at just today. I look at longer term.’
CapitaMalls Malaysia Trust is scheduled to list on July 16 when JPMorgan Chase & Co will act as stabilising manager, the company said in a separate exchange filing yesterday.
JPMorgan, CIMB Investment Bank Bhd, and Maybank Investment Bank Bhd are jointly managing the sale.
‘It is a good proxy to the Malaysian Reit sector that we believe is due for another round of re-rating,’ Joshua Ng, an analyst at RHB Research Institute Sdn, said in a report yesterday. ‘Its growth prospects are good, underpinned by growing rentals and acquisitions.’
Singapore-based CMA, part of South-east Asia’s biggest developer CapitaLand Ltd, owns shopping malls in China, India and Singapore. CapitaMalls Malaysia is the owner of the Sungei Wang Mall in Kuala Lumpur, The Mines mall, which is south of the city centre, and Gurney Plaza in Penang, according to the company’s prospectus.
‘We are heartened by the success of the offering,’ CMA chief executive officer Lim Beng Chee said in the statement. ‘Despite the challenging market conditions, it is priced at one of the tightest yields for a Malaysian Reit initial public offering.’ – Bloomberg
Sunway – thestar
Sunway REIT attracts huge foreign funds
Sunway Real Estate Investment Trust (REIT), the largest property trust in Asia excluding Japan since 2007, has attracted a significant amount of funds from foreign institutional investors.
Sunway REIT’s initial public offering (IPO) on Bursa Malaysia Main Market yesterday raised RM1.49bil.
Sunway REIT Management Sdn Bhd chief executive officer Datuk Jeffrey Ng said the property trust was 45% subscribed by foreign institutional investors.
“This (foreign stake) clearly reflects their confidence in the performance of the trust,” he said after the listing ceremony.
Sunway REIT posted a one sen discount over its offer price of 90 sen upon listing. The price opened at 89 sen and hit a high of 89.5 sen in early morning trade before closing at 88.5 sen with 72 million units changing hands.
Ng said the property trust was well subscribed by investors despite market volatility and current global economic conditions.
Upon listing, Sunway REIT had assets worth RM3.5bil and a free float of RM1.6bil.
On Sunway REIT’s yield, Ng said it was about 7.5, which was within the mean range of most REITs, and had the potential to improve over time.
Sunway Group chairman and founder Tan Sri Jeffrey Cheah said with the listing, he hoped to see more companies with deeper awareness and investments in the local REIT market.
“Hopefully, we can continue to gain positive momentum and support from investors and regulators,” he said.
Cheah said with Sunway REIT, investors could now look forward to owning properties in high-growth locations.
“We aim to provide unitholders with exposure to a diversified portfolio of authorised investments which can provide stable cash distribution and a potential for sustainable growth in terms of net asset value per unit.”
He added that Sunway REIT aimed to double its asset size in five to seven years.
The eight properties injected into the REIT are Sunway Pyramid Shopping Mall, Sunway Carnival Shopping Mall, SunCity Ipoh Hypermarket, Sunway Resort Hotel and Spa, Pyramid Tower Hotel, Sunway Hotel Seberang Jaya, Menara Sunway and Sunway Tower.
An OSK Research report said with its exposure to the retail, hospitality and office sub-sectors, Sunway REIT was a defensive trust that could offer unitholders long-term growth.
An analyst with another brokerage said Sunway REIT had a huge asset base and the trust could easily be leveraged up.
He said the trust had the capacity to get support from financial institutions to expand quickly by buying “ready” properties without reaching its internal gearing or statutory limit.
Sunway – BT
Sunway REIT unfazed by weak debut
The stock opened at a 1 sen discount to its offer price of 90 sen and closed at the same price of 89 sen
SHARES of Sunway real estate investment trust (REIT), Malaysia’s biggest property trust, opened lower on their listing debut yesterday, but management remained unfazed by the stock market’s recent weakness.
The stock opened at a 1 sen discount to its offer price of 90 sen and closed at the same price of 89 sen, although the market ended broadly higher.
Sunway REIT Management Sdn Bhd chief executive officer Datuk Jeffrey Ng said he was confident the REIT would perform well despite its disappointing start.
“Nearly half of our investors are foreign investors and we are heartened to see big corporations, both overseas and domestic, investing in us despite the volatile markets of the last two months,” he told reporters at a press conference after its listing in Kuala Lumpur yesterday.
The REIT also has cornerstone investors like Singapore’s investment firm GIC, Great Eastern Life Assurance Malaysia Bhd, Employees Provident Fund and Permodalan Nasional Bhd.
Cornerstone investors usually join large initial public offerings IPOs and unlike institutional investors, they have a confirmed allocation.
Sunway REIT is Malaysia’s largest REIT in corporate history and it is also the largest REIT IPO in Asia, excluding Japan, since 2007.
“We have started the ball rolling for other REITs and I believe they will also gain their momentum. Other new players who come in will have to match the qualities of the fundamentals and when they go out marketing,” Ng said.
Sunway REIT is made up of eight Sunway City Bhd’s properties in the retail and hospitality sector in Penang, Perak, Selangor and Kuala Lumpur, including the popular Sunway Pyramid shopping mall.
Sunway – BT
Sunway REIT falls below reference price
Sunway Real Estate Investment Trust (Sunway REIT) fell on its Malaysian market debut after raising about RM1.5 billion in Southeast Asia’s biggest initial public offering this year.
Sunway REIT’s units were trading at 89 sen each at 9.14 am local time, below its opening reference price of 90 sen.
Meanwhile, Jeffery Cheah, chairman of its parent company Sunway Holdings Bhd said the REIT aims to double its asset size in five to seven years.
“The whole purpose is to grow it,” Cheah told reporters in Kuala Lumpur today. – Bloomberg