Paradigm REIT sets final IPO price at RM1 amid subdued demand

• Slated for listing on the Main Market on June 10, the IPO does not involve issuance of new units, meaning that the trust itself will not receive any proceeds.

KUALA LUMPUR (May 28): Paradigm Real Estate Investment Trust (KL:PARADIGM) on Thursday set the final price for its initial share sale at RM1 apiece as previously indicated amid subdued demand from some investors.

Investors put in orders for a total of 79.78 million units, which was more than double the amount of units available to the Malaysian public, according to a statement from the issuing house. Based on 32 million units on offer, the applications translate into an oversubscription rate of 1.49 times.

The Bumiputera portion saw a weak response, with applications for only 4.65 million units and short of the 16 million units allocated. The unsubscribed units were clawed back and reallocated. The non-Bumiputera portion, however, was oversubscribed by 3.7 times.

Other parts of the retail offering also saw subdued demand. For the restricted offer for sale to shareholders of WCT Holdings, only 73.62 million units were taken up, as compared to the 194.86 million units made available.

The restricted pink form offerings for eligible persons saw only 8.43 million units subscribed, compared with the 27.79 million units offered.

The undersubscribed units were then offered to the institutional investors, where the joint bookrunners confirmed that all the 426.59 million units, including the reallocated units, were fully subscribed.

Slated for listing on the Main Market on June 10, the IPO does not involve issuance of new units, meaning that the trust itself will not receive any proceeds. Based on the final price of RM1.00, the IPO grossed RM560 million, which all went to WCT Holdings Bhd (KL:WCT), the sponsor of the REIT.

Paradigm owns and manages the Bukit Tinggi Shopping Centre, Paradigm Mall Petaling Jaya and Paradigm Mall Johor Bahru. The three assets worth RM2.4 billion are either fully or nearly fully occupied.

The expected annualised distribution yield for 2025 is estimated at over 7%, based on the retail price of RM1 per unit.

Upon listing, property tycoon Tan Sri Desmond Lim Siew Choon will own 60.7% in Paradigm through WCT.

Maybank Investment Bank is the principal adviser, sole managing underwriter and lead bookrunner for the IPO. CGS International and AmInvestment Bank are joint underwriters and bookrunners. RHB Investment Bank Bhd is a joint bookrunner.

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