Frasers Centrepoint Trust to buy rest of Northpoint City for $1.17 billion

Source: The Straits Times

SINGAPORE – The manager of Frasers Centrepoint Trust (FCT) announced on March 25 it will buy the rest of Northpoint City in Yishun for $1.17 billion.

The acquisition will make FCT the largest suburban retail landlord with a 10.3 per cent market share.

The sellers are Frasers Property, its controlling shareholder, Thai billionaire Charoen Sirivadhanabhakdi, and the estate of his late wife.

FCT inked agreements with FCL Amber and Bright Bloom Capital to acquire the south wing of Northpoint City for $1.17 billion. It will be done via the purchase of North Gem Trust (NG Trust), a private trust that holds the interests in the target property.

FCL Amber and Bright Bloom are the 50:50 owners of NG Trust. FCL Amber is a wholly-owned subsidiary of Frasers Property. Bright Bloom is a unit of TCC Prosperity, owned equally by Mr Sirivadhanabhakdi and the estate of his late wife Khunying Wanna Sirivadhanabhakdi.

Following the acquisition, FCT will have full ownership of Northpoint City, said Mr Richard Ng, chief executive of the manager of FCT.

“With full control, FCT will be able to implement holistic asset enhancement initiatives and tenant mix strategies to unlock further value across both wings,” he noted.

Mr Ng added: “The acquisition consolidates FCT’s position as Singapore’s leading prime suburban retail space owner and enables FCT to deliver regular and stable distributions to its unit holders.”

Northpoint City is the largest mall in north Singapore. It is linked to Yishun Integrated Transport Hub and has a 100 per cent committed occupancy.

The acquisition cost of $1.17 billion comprises $375.2 million for the acquisition price and about $785 million of bank loans owed by NG Trust. It also includes about $11.3 million in acquisition fees payable to the manager, as well as other acquisition-related fees and expenses of about $1.4 million.

The manager intends to finance the acquisition by utilising the net proceeds from an issuance of new equity via a fund-raising launched on March 25.

This comprises a private placement offering to raise gross proceeds of no less than approximately $200 million and a preferential offering to raise gross proceeds of about $200 million.

The manager also intends to tap debt financing and potentially issue subordinated perpetual securities of no more than approximately $200 million.

The proposed acquisition is subject to approval by unit holders of FCT at an extraordinary general meeting to be convened by the trust at a date to be determined by the manager.

Units of FCT closed 0.5 per cent higher at $2.21 on March 24, ahead of a trading halt on March 25.