Frasers Commercial Trust spurns offer to invest in Frasers Tower
SINGAPORE (June 27): Frasers Commercial Trust (FCOT) has turned down an invitation from sponsor Frasers Property Limited (FPL) to acquire a stake in Frasers Tower under a right of first refusal (ROFR) agreement.
The ROFR offer was made after FPL gave notice it was selling half of its 100% stake in Frasers Tower to a long-term strategic investor via the issue of new Aquamarine Star Trust (AST) units.
AST holds Frasers Tower, the 38-storey premium Grade A office development located on Cecil Street and has a three-story adjacent retail podium. It has a total NLA of about 685,000 sf, of which around 93% is leased as at March 31.
Under the ROFR agreement entered into on June 30, 2009, between FPL and British and Malayan Trustees Limited, the trustee of FCOT, FPL has to give notice to FCOT should it decide to sell the property.
In response, FCOT’s manager says it has considered the opportunity and believes the proposed investment and terms, including the transaction amount, would not be accretive to its distribution per unit.
The 50% stake sale of Frasers Tower is expected to raise some $442.7 million, based on half of AST's adjusted NAV immediately after the closing of the proposed transaction.
As at 3.17pm, units in FCOT were trading at $1.67, down one cent.
