CapitaLand Malaysia Trust plans RM250m private placement to repay borrowings

• Based on an illustrative issue price of 57.41 sen per unit—a 10% discount to the five-day volume-weighted average market price (VWAMP) of 63.79 sen as at May 20—the placement could raise gross proceeds of up to RM250 million.

KUALA LUMPUR (June 3): CapitaLand Malaysia Trust (KL:CLMT) has proposed a private placement to raise as much as RM250 million, mainly to repay bank borrowings, according to its bourse filing on Tuesday.

The exercise involves the issuance of up to 435.4 million new units, or approximately 14.9% of its total issued units. The new units will be offered to its sponsors and institutional investors, including the Employees Provident Fund (EPF) and Kumpulan Wang Persaraan Diperbadankan (KWAP), with the final issue price to be determined via a bookbuilding exercise.

Based on an illustrative issue price of 57.41 sen per unit—a 10% discount to the five-day volume-weighted average market price (VWAMP) of 63.79 sen as at May 20—the placement could raise gross proceeds of up to RM250 million.

CIMB Investment Bank, the principal adviser for the exercise, announced the proposal in a bourse filing on behalf of CapitaLand Malaysia REIT Management Sdn Bhd, the management company of CLMT. The placement is expected to be completed by the third quarter of this year.

As at May 20, CLMT’s total borrowings stood at RM2.2 billion. The trust has undertaken nearly RM400 million in completed and announced acquisitions of industrial and logistics assets, which were mainly funded through debt.

Of the total proceeds raised, RM246.1 million will be used to repay borrowings, while RM3.9 million has been earmarked for estimated placement-related expenses.

 “The proposed placement is aligned with the manager’s prudent capital management strategy to optimise CLMT’s financing ratio, providing financial headroom for future acquisitions while maintaining balance sheet flexibility,” the filing read.

Post-exercise, CLMT’s gearing is expected to reduce to 39.6% from 41.3% as at end-December 2024.

CLMT’s portfolio comprises six retail malls and two logistics assets with a combined net lettable area of 4.3 million sq ft. Its retail assets include Gurney Plaza and Queensbay Mall in Penang; Sungei Wang Plaza, 3 Damansara, and The Mines in the Klang Valley; and East Coast Mall in Kuantan, Pahang. The logistics assets are Valdor Logistics Hub in Penang, and Glenmarie Distribution Centre in Shah Alam, Selangor.

On the proposed placement, CLMT’s sponsors—CapitaLand Mall Asia Ltd-linked entities CMMT Investment Ltd (CIL) and Menang Investment Ltd (MIL), which collectively hold a 40% stake—may subscribe for up to 174.2 million units to maintain their current stake.

Institutional investors such as EPF, KWAP and Amanah Saham Bumiputera (ASB) may also be allocated up to 292.14 million units each. As at May 20, EPF held a 15.4% stake in CLMT, followed by KWAP with 10% and ASB with 8.1%.

All proposed allotments to major unitholders will be subject to the approval of non-interested unitholders at a meeting to be convened.

CLMT said the placement would not trigger a mandatory general offer, as none of the participating investors would see their holdings exceed the 33% threshold.

The trust also noted that it remains compliant with Bursa Malaysia’s public spread requirement, with a current public unitholding spread of about 44.1%.

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