Putting Trust in REIT stocks (Mapletree Group)
#1

Mapletree Commercial Trust
Mapletree NAC Trust
Mapletree Industrial Trust
Mapletree Logistics Trust

Will include news on Mapletree Investment also
Reply
#2

Court hearing for MNACT trust scheme application rescheduled to Feb 21

MAPLETREE North Asia Commercial Trust's (MNACT) Mapletree NAC Tr: RW0U +0.92% trust scheme application for its merger with Mapletree Commercial Trust (MCT) Mapletree Com Tr: N2IU -0.55% will now be heard by the court on Feb 21, 10 am instead of Feb 18, 2.30 pm.

The trust scheme application was filed with the court for leave to convene a trust scheme meeting for MNACT unitholders to cast their votes for the merger.

The merger will see MNACT unitholders receive a scheme consideration of S$1.1949 for each MNACT unit held as at the record date to be announced. For each MNACT unit held, unitholders will receive either 0.5963 new MCT units at an issue price of S$2.0039 apiece, or a combination of 0.5009 consideration units and S$0.1912 in cash.

https://www.businesstimes.com.sg/compani...-to-feb-21
Reply
#3

MLT unitholders vote in favour of plans to acquire assets in China, Vietnam

UNITHOLDERS of Mapletree Logistics Trust (MLT) have voted in favour of its plan to acquire 13 logistics assets in China and 3 properties in Vietnam as well as the proposed issue of 106 million new units in MLT as partial consideration for the acquisitions in China.

MLT's manager released the minutes of an extraordinary general meeting (EGM) held on Jan 13 in a bourse filing on Friday (Feb 11), which indicated that 99.7 per cent of unitholders voted in favour of the proposed acquisitions, while 0.3 per cent voted against it.

A total of 99.7 per cent of unitholders also voted in favour of the proposed issue of 106 million new units to Mulberry, a subsidiary of MLT's sponsor Mapletree Investments (MIPL), for the acquisitions in China. The consideration units would be issued at S$1.88.
Reply
#4

Mapletree's Chua Tiow Chye adds to MIT stake
On Feb 7, Mapletree Industrial Trust Management non-executive director Chua Tiow Chye acquired 200,000 units of Mapletree Industrial Trust Mapletree Ind Tr: ME8U -1.57% (MIT) at an average price of S$2.49 per unit.

With a consideration of S$498,500, this increased his deemed interest from 0.04 per cent to 0.05 per cent. This followed Chua's acquisition of 200,000 units of MIT at an average price of S$2.60 per unit on Jan 26.

Chua is also the deputy group CEO of Mapletree Investments Pte Ltd, the sponsor of MIT.

With the Q3FY21/22 (ended Dec 31) financials released on Jan 25, the CEO of Mapletree Industrial Trust Management, Tham Kuo Wei, noted that the resumption of the distribution reinvestment plan with the Q3FY21/22 distribution will help to finance the redevelopment of the Kolam Ayer 2 Cluster and provide greater financial flexibility to seize investment opportunities.

The distribution reinvestment plan enables MIT unitholders to acquire new units without incurring additional transaction related costs.

At the same time the issue of units in lieu of cash distributions is expected to strengthen MIT's balance sheet, help finance the progressive funding needs of development projects and accord MIT greater financial flexibility to pursue growth opportunities as part of MIT's proactive capital management efforts.
Reply
#5

Mapletree Logistics Trust to acquire 2 prime land parcels in Malaysia for RM65.6m
MAPLETREE Logistics Trust Mapletree Log Tr: M44U 0% (MLT) on Tuesday (Feb 15) announced that it will acquire 2 parcels of leasehold industrial properties in Subang Jaya in the Malaysian state of Selangor for a total price of RM65.6 million (S$21.0 million).

Sitting on total land area of 257,000 square feet (sq ft), the property is located next to MLT's existing Subang 3 and 4 properties, and a 20-minute drive from MLT's other assets - Mapletree Shah Alam Logistics Park and Mapletree Logistics Hub - Shah Alam.

Ng Kiat, chief executive of MLT's manager, said this acquisition offers a "rare redevelopment opportunity" for the trust to amalgamate the property with its existing adjacent properties - Subang 3 and 4. "This is in line with our strategy to optimise MLT's portfolio and future-proof our assets through asset rejuvenation," she said.

https://www.businesstimes.com.sg/compani...for-rm656m
Reply
#6

Quarz Capital decries ' value destructive' offer for MNACT in proposed merger with MCT

ACTIVIST fund manager Quarz Capital Management has taken issue with what it says is a " value destructive" deal for Mapletree North Asia Commercial Trust (MNACT) Mapletree NAC Tr: RW0U +0.9% to merge with Mapletree Commercial Trust (MCT) Mapletree Com Tr: N2IU +0.55%.

In an open letter addressed to the board and management of MNACT, Quarz said the proposed merger price significantly undervalues MNACT and comes at a " massive" discount to its net asset value (NAV) per unit.

" The proposed merger offer price for MNACT is at one of the highest discounts to NAV in the 20-year history of the Singapore real estate investment trust (Reit) market," Quarz said in a letter sent to MNACT on Wednesday (Feb 9) night. " We urge MNACT' s board and management to protect unitholders' interest and negotiate for a higher and fairer merger offer."

Quarz claims that it has been approached by " many MNACT unitholders" regarding MCT' s " inferior offer" for MNACT.

The fund manager said it advises entities that hold long term investments on behalf of institutions, endowments and families. Together with its affiliates, Quarz said the combined holdings it controls in MNACT would rank it among the top 10 unitholders of the trust.

According to Bloomberg data, Temasek Holdings - through Mapletree Investments - is the top unitholder for MNACT, with a 38.1 per cent stake in the trust. This is followed by Schroders and Vanguard Group, with 4.6 per cent and 2.3 per cent stakes, respectively.

MCT and MNACT on Dec 31, 2021, proposed the merger between the 2 Mapletree Reits to create Mapletree Pan Asia Commercial Trust (MPACT). The merged entity would leapfrog its way to become the third largest Reit in Singapore and rank among the top 10 Reits in Asia by market capitalisation.

The proposed trust scheme would see MNACT unitholders receive a scheme consideration of S$1.1949 for each MNACT unit held - either via 0.5963 new MCT units at an issue price of S$2.0039 apiece, or a combination of 0.5009 consideration units and S$0.1912 in cash.

For illustrative purposes, this means that a unitholder holding 10,000 MNACT units will receive 5,963 MCT units should they elect to receive the scrip-only consideration or 5,009 MCT units and S$1,912 in cash should they elect to receive the cash-and-scrip consideration.

This implies a gross exchange ratio of 0.5963 times.

The Reit managers said then that the scheme consideration price of S$1.1949 was in line with MNACT' s NAV.

Since the announcement, however, units of MCT have dived, changing the dynamics of the proposed merger. Units of MCT have fallen 8.5 per cent or S$0.17 - from S$2.00 before the proposed merger announcement - to close at S$1.83 as at Feb 9.

Meanwhile, units of MNACT are trading flat at S$1.11 - the same level it was at before the announcement.

" With MCT' s price correction, the implied scheme consideration for MNACT is now at a significantly lower level of approximately S$1.08 to S$1.10, down from S$1.1949," Quarz said.

In addition, Quarz said the implied merger offer is at a " massive discount" of about 12 per cent from MNACT' s NAV of S$1.23 in October 2021. " The offer price is at an even larger approximately 14 per cent and approximately 23 per cent discounts to MNACT' s NAV of S$1.27 and S$1.41 in March 2021 and March 2020, respectively," it added.

Noting that about a quarter of MNACT' s current portfolio had been purchased at around NAV in the last 4 years and have mostly appreciated in value, Quarz called the merger proposal to " sell" the assets at below NAV " both ludicrous and value-destructive" .

It added that this substantial discount to NAV is " unprecedented" , as nearly all the Reits involved in takeovers and mergers in Singapore over the years had - like MNACT - also traded below NAV.

In its letter, Quarz claimed MNACT unitholders will see declines in distribution per unit (DPU) of between 8.2 per cent and 9.3 per cent after the merger &ndash depending on whether they choose the scrip-only or cash-and-scrip option.

&ldquo We believe that MCT has opportunistically taken advantage of MNACT&rsquo s depressed NAV and unit price to launch the merger offer and benefit from MNACT&rsquo s potential sizeable DPU and unit price upside,&rdquo Quarz said.

The fund manager argued that the performance of MNACT&rsquo s portfolio had been &ldquo temporarily disrupted&rdquo by the stumble of its largest asset &ndash the Festival Walk mall in Hong Kong.

Festival Walk had suffered extensive damage due to street protests in November 2019. Since it reopened in January 2020 following repairs, the mall has been bogged down by the closure of the Hong Kong-China border due to the Covid-19 pandemic.

&ldquo Despite the temporary weakness in Festival Walk, MNACT continues to yield a highly attractive dividend yield of about 6.3 per cent &ndash one of the highest among large-cap Reits with reputable sponsors,&rdquo Quarz said.

Quarz is expecting MNACT&rsquo s NAV, DPU and unit price to stage a strong recovery in the second half of 2022 on the back of a number of key catalysts.

&ldquo A conservative approximately 10 per cent recovery in rental rates from the reopening of the Hong Kong-China border and the enactment of the government stimulus plans can drive MNACT&rsquo s DPU to about S$0.073 and dividend yield to around 6.8 per cent,&rdquo Quarz said.

It added that MNACT&rsquo s unit price could rerate back to over S$1.20 in H2, with its potential inclusion into the FTSE Nareit Developed and Developed Asia indices at the June 2022 review.

&ldquo The potential increase in institutional following and passive buying following the entry into the indices can significantly rerate MNACT&rsquo s unit price,&rdquo Quarz said.

&ldquo The sizeable value creation benefits of the merger seem mostly skewed in favour of MCT&rsquo s unitholders,&rdquo it added. &ldquo It is thus disappointing and troubling that the manager of MNACT is pushing for a merger offer at such a sharp discount to NAV and forcing MNACT unitholders to forgo the trust&rsquo s promising standalone prospects and suffer substantial DPU and NAV reduction.&rdquo

&ldquo The proposed merger between MNACT and MCT is the second largest transaction in Singapore Reit history and will be keenly watched by the investment community,&rdquo it added.

&ldquo Mapletree&rsquo s treatment of MNACT minority unitholders will serve as a reference by potential new investors to evaluate their investment in Mapletree-managed Reits.&rdquo

Quarz suggested the exchange ratio for the proposed MCT-MNACT merger should be 0.68 times, instead of 0.5963 times.

It noted that the scheme issue price of MCT units at S$2.0039 is a premium to MCT&rsquo s NAV. &ldquo An appropriate issue price for MCT should be S$1.82 per unit and a scrip-only unit exchange ratio in excess of 0.68 MCT unit for 1 MNACT unit,&rdquo Quarz said.

This is not the first time Quarz is protesting valuations in a Reit merger.

Together with Black Crane Capital, Quarz led minority unitholders to scuttle the proposed merger between ESR-Reit ESR-REIT: J91U +2.35% and Sabana Reit Sabana Reit: M1GU +2.27% in 2020. It had argued then that the valuation accorded to Sabana Reit in the transaction was too low.

In response to queries by The Business Times (BT), the manager of MCT said that the merits of the proposed merger are articulated in the joint announcement issued on Dec 31.

&ldquo We note that Quarz acknowledges the deal rationale, as stated in the joint announcement made on Dec 31, 2021, and sees value in MNACT,&rdquo the Reit manager said. &ldquo Unitholders should also note that listed Reits are required to comply with regulatory requirements and safeguards which are in place to protect the interests of minority unitholders.&rdquo

MNACT&rsquo s manager, meanwhile, said it appreciates the perspectives and feedback of unitholders. It added that the scheme document &ndash expected to be issued at the end of March &ndash will contain the recommendations of the independent directors for the trust scheme as well as the independent financial adviser&rsquo s opinion for unitholders to make an informed decision.

&ldquo The rationale and terms of the proposed merger have been carefully considered, and we continue to believe these to be beneficial to unitholders, both from a strategic and financial perspective,&rdquo the MNACT manager said.
Reply
#7

Quarz' s campaign may help rather than hinder the proposed merger of MCT and MNACT
Its insistence that MNACT is being undervalued might - perversely - mollify disgruntled MCT unitholders inclined to vote against the merger

THE proposed merger of Mapletree Commercial Trust (MCT) and Mapletree North Asia Commercial Trust (MNACT) made headlines again this past week as Quarz Capital Management urged unitholders of MNACT to demand better terms or vote against the deal.

Quarz grumbled in a letter to MNACT' s manager dated Feb 9 that the merger values MNACT at discount to its net asset value (NAV), and that the transaction will destroy value for unitholders.

This is an interesting twist. When the proposed merger of the two Mapletree real estate investment trusts (Reits) was announced on Dec 31, the consensus in the market seemed to be that the terms of the deal favoured unitholders of MNACT over those of MCT.

Will Quarz' s campaign now rally MNACT unitholders to oppose the merger too? Or, could Quarz' s insistence that MNACT is being undervalued - perversely - mollify disgruntled MCT unitholders inclined to vote against the merger?

Under the proposed merger, unitholders of MNACT will exchange each unit they own for 0.5963 of a new MCT unit or 0.5009 of a new MCT unit plus S$0.1912 in cash.

Based on MCT' s closing price before the announcement of S$2.00, each unit of MNACT was effectively being valued at about S$1.193. This was some 7.5 per cent more than MNACT' s closing price before the announcement of S$1.11.

It was also very close to MNACT' s NAV per share as at Sep 30, 2021, of S$1.1949 - adjusted for H1 FY2022 distribution per unit (DPU) paid on Dec 24, 2021, and the valuation of MNACT' s assets as at Sep 30, 2021, as announced on Dec 31, 2021.

On Jan 3, the first post-announcement trading day, MNACT climbed 3.6 per cent to close at S$1.15 while MCT fell 4 per cent to close at S$1.92.

Since then, MCT has fallen further and pulled MNACT down with it. On Friday (Feb 11), MCT closed at S$1.83 while MNACT closed at S$1.09.

With this correction in MCT' s market price, Quarz now wants the terms of the merger adjusted such that the implied valuation of MNACT is pushed back up towards its NAV. Specifically, Quarz has suggested that each unit in MNACT be exchanged for 0.68 of a new unit in MCT.

But wouldn' t such a change in the merger terms only spark a further sell-off in MCT? And, wouldn' t that make it even harder to convince already sceptical MCT unitholders to vote for the deal?

Bullish on MNACT

Quarz does not accept that MCT' s market price sank because of the proposed merger alone.

Quarz said last week that rising interest rates have weighed heavily on the market value of several Singapore-listed Reits that were trading at compressed DPU yields - including Mapletree Logistics Trust, Mapletree Industrial Trust, Parkway Life Reit and Keppel DC Reit.

Quarz also suggested the market might be realising MCT has relatively limited growth potential, and its units were simply overvalued compared with those of its peers.

Before the merger was unveiled, MCT was trading at an annualised H1 FY2022 DPU yield of 4.4 per cent and a 16.3 per cent premium to its NAV as at Sep 30, 2021.

On the other hand, MNACT was trading at an annualised H1 FY2022 DPU yield of 6.2 per cent and a 12.3 per cent discount to NAV as at Sep 30, 2021.

MCT' s superior market valuations compared to MNACT seemed justified. For one thing, MCT had delivered higher annualised growth in its DPU and NAV per share than MNACT since their respective initial public offerings.

MCT also achieved a positive 2.3 per cent portfolio rental reversion in H1 FY2022. Its office and business park assets saw a 1.5 per cent reversion. Its retail properties - including its flagship asset, VivoCity - benefited from a 3.5 per cent rental reversion.

By contrast, MNACT still seems to be reeling from the impact of Hong Kong riots in 2019 and the pandemic that began in 2020. In particular, the shopping mall at Festival Walk suffered rental reversions of negative 30 per cent in H1 FY2022.

Quarz insists things are looking up for Festival Walk though. The asset manager is betting the Covid-19 pandemic will continue waning, and the Hong Kong-China border will soon reopen.

The way Quarz sees it, MCT is acting opportunistically by proposing a merger with MNACT now. " We are confident and bullish that MNACT' s NAV, DPU and unit price will stage a strong recovery from H2 2022," Quarz said in its letter of Feb 9.

Sufficient support?

The big question is whether Quarz will be able to garner sufficient support from fellow MNACT unitholders to block the merger.

So far, Quarz has only been willing to say that it is among the top 10 unitholders of MNACT.

MNACT' s last annual report shows that its sponsor group Mapletree Investments had a deemed interest in 37.6 per cent of its units as at May 28 2021.

The merger is to be effected by a scheme of arrangement. Amendments to MNACT' s trust deed to facilitate the scheme require 75 per cent support of all units voting at an extraordinary general meeting.

The scheme itself needs the support of the majority of unitholders holding 75 per cent of the units voting at the scheme meeting. Mapletree Investments will abstain from voting at the scheme meeting.

Neither the manager of MCT nor the manager of MNACT seem too concerned about Quarz' s campaign though.

MNACT' s manager said last week that it " appreciates the perspectives and feedback of unitholders, and notes that Quarz regards positively the strategic rationale of the proposed merger" .

MCT' s manager hinted that Quarz might be helping it dispel the notion that acquiring MNACT would be detrimental for MCT' s unitholders. " We note that Quarz acknowledges the deal rationale, as stated in the joint announcement made on Dec 31, 2021, and sees value in MNACT."

It would be ironic if Quarz' s campaign ultimately does more to persuade MCT unitholders to support the merger than it does to convince MNACT unitholders to vote against the deal.
Reply
#8

Sias questions MCT-MNACT proposed merger

https://www.businesstimes.com.sg/compani...sed-merger
Reply
#9

MCT to benefit from development of Greater Southern Waterfront: UOB Kay Hian

With five properties located in the Harbourfront area including VivoCity, Mapletree Commercial Trust (MCT) is set to benefit from the development of the Greater Southern Waterfront and the rejuvenation of Sentosa Island and Pulau Brani, says UOB Kay Hian analyst Jonathan Koh in his Feb 18 report.

Another re-rating catalyst for the REIT’s share price would be the distribution per unit (DPU) and net asset value (NAV) accretion from the merger with Mapletree North Asia Commercial Trust (MNACT), Koh adds.

https://www.theedgesingapore.com/capital...b-kay-hian
Reply
#10

Reality check: questions posed by SIAS to MNACT and MCT managers

Questions posed to the managers of Mapletree North Asia Commercial Trust (MNACT) and Mapletree Commercial Trust (MCT) by David Gerald, president and CEO, the Securities Investors Association Singapore (SIAS) underscore the diversification of properties dictum for S-REITs, highlighting the challenge MNACT has in growing its portfolio.

On the portfolio front, SIAS points out that Festival Walk and Gateway Plaza, account for more than 70% of MNACT’s portfolio, and they continued to report lower average rental rate. “Rental reversion for Festival Walk accelerated from negative 21% to negative 30%. For Gateway Plaza in Beijing, the rental reversion was from negative 7% to negative 24%. A major tenant at Gateway Plaza is due for renewal in December 2023,” SIAS indicates.

https://www.theedgesingapore.com/capital...t-managers
Reply
#11

MNACT's manager working on Gateway Plaza occupancy, says no other offer on table

Questions posed to the managers of Mapletree North Asia Commercial Trust (MNACT) and Mapletree Commercial Trust (MCT) by David Gerald, president and CEO, the Securities Investors Association Singapore (SIAS) underscore the diversification of properties dictum for S-REITs, highlighting the challenge MNACT has in growing its portfolio.

On the portfolio front, SIAS points out that Festival Walk and Gateway Plaza, account for more than 70% of MNACT’s portfolio, and they continued to report lower average rental rate. “Rental reversion for Festival Walk accelerated from negative 21% to negative 30%. For Gateway Plaza in Beijing, the rental reversion was from negative 7% to negative 24%. A major tenant at Gateway Plaza is due for renewal in December 2023,” SIAS indicates.

“Is the proposed Merger a way to leverage the resilient MCT’s portfolio at a time when Festival Walk and Gateway Plaza are underperforming? What are the plans and asset enhancement potential for these two assets? Regardless of the outcome of the proposed Merger, are these two assets considered core to the REIT?” SIAS asks.

Festival Walk and Gateway Plaza accounted for 68% of net property income of $166.2 million, recorded in 1HFY2022, for the six months to Sept 30, 2021.

Gateway Plaza - a splendid building in the heart of Beijing - has as its anchor tenant BMW. In presentation on Oct 28, MNACT’s manager had said one of the major tenants (whose current lease is due to expire by December 2022) has extended its lease in advance by another year. There is a risk that this lease might not be extended beyond December 2023, it added. In 1HFY2022, Gateway Plaza had renewals for 13 office leases with average rental reversions of negative 24%.

https://www.theedgesingapore.com/capital...ffer-table
Reply
#12

Mapletree Logistics Trust to acquire Baeksa Logistics Centre in South Korea for 88.5b won

THE manager of Mapletree Logistics Trust (MLT) has announced a proposed acquisition of Baeksa Logistics Centre in South Korea for 88.5 billion won (S$100.3 million).

The real estate investment trust (Reit) will expand its presence in South Korea with the acquisition, it said in a bourse filing on Monday evening (Feb 28).

The property is located within the established Yongin-Icheon logistics hub that serves the Seoul Metropolitan Area. It is a 4-storey single-block dry logistics facility with a total gross floor area of over 41,100 sq m on 30,000 sq m of freehold land. It has been built with specifications such as strong floor loading of over 20 KiloNewtons per sq m, direct ramp access and spacious docking yards to facilitate logistics operations.

https://www.businesstimes.com.sg/compani...-korea-for
Reply


Forum Jump:


Users browsing this thread: 1 Guest(s)