Eagle Hospitality Trust public offering re-allocated due to under-subscription
SINGAPORE (May 24): The managers of Eagle Hospitality Trust (EHT) have re-allocated 1.28 million stapled securities from the public offer to the placement tranche due to under-subscription in public tranche of the offering.
See: Eagle Hospitality Trust registers prospectus with MAS; to raise $620 mil from IPO
At the close of offer on the noon of May 22, 1,528 valid applications were received for 18.3 million stapled securities out of the 44.9 million stapled securities available to the public for subscription under the public offer.
This means 26.6 million stapled securities in the public offering did not receive any applications and also translates into a subscription rate of just 0.4 times.
Initially, 580.6 million stapled securities, comprising 535.7 million stapled securities offered under the placement tranche and 44.9 million stapled securities were offered under the public offer.
With the re-allocation, the offering comprised roughly 537 million stapled securities offered under the Placement Tranche and 43.6 million stapled securities were offered under the public offer.
EHT’s trustee-managers says the enlarged 537 million stapled securities have been fully subscribed.
At the issue price of US 78 cents, the IPO of EHT has raised some US$453 million ($620 million) in gross proceeds.
Cornerstone investors with a 16.7% aggregate interest in the trust include DBS Bank, family fund Global Pot Developments, a co-founder of Chinese online travel service provider Ctrip.com, as well as Huazhu Group’s founder, Ji Qi.
DBS Bank acted as the sole financial adviser and issue manager for the deal. The bank was also a joint global coordinator and bookrunner, as well as the underwriter for the offering.
Other joint bookrunners and underwriters for the offering include Merrill Lynch (Singapore) Pte. Ltd., UBS AG, BNP Paribas, Deutsche Bank AG and Jefferies Singapore.
“We are excited and proud to successfully complete the largest IPO on the Singapore Exchange in 2019 to date,” says Salvatore Takoushian, CEO and president of the managers.
“We believe in the long-term investment merits of EHT’s portfolio and remain committed to increasing our presence in Singapore while building EHT through partnering with our Sponsor, Urban Commons. We look forward to delivering on our strategy of value creation and optimising the performance of our assets,” he adds.
EHT is due to commence trading on a “ready” basis at 2pm today.
The trust is set to distribute 100% of its annual distributable income until the end of FY20, after which it will distribute at least 90% of its annual distributable income.
Based on the offering price of 78 US cents per stapled security, this represents an annualised distribution yield of 8.2% and 8.4% for the forecast period 2019 and projection year 2020, respectively.
Login to read more at Eagle Hospitality Trust offers highest forecast yields among hospitality trusts and opportunities for growth in Issue 883 of The Edge Singapore (week of May 27), which is available at newsstands today.
