SC approves IOI Properties REIT manager’s fund-management application

PETALING JAYA (Aug 19): IOI Properties Group Bhd (IOIPG) has secured conditional Securities Commission Malaysia (SC) approval for its proposed real estate investment trust (REIT) manager’s fund-management application.

In a Bursa Malaysia filing on Wednesday (Aug 19), the property developer said the SC had approved IOI REIT Management Sdn Bhd’s (IRMSB) application for the regulated activity of fund management in relation to asset management restricted to REITs.

The approval, issued on Aug 18 and received by IOIPG on Wednesday, forms part of the regulatory process for the proposed establishment and proposed listing of IOIPG Malaysia Real Estate Investment Trust (IOIPG REIT).

It follows the SC’s approval earlier this month for the establishment and proposed listing of IOIPG REIT on Bursa Malaysia’s Main Market, IRMSB’s appointment as the REIT’s proposed management company, and the application under the Bumiputera equity requirement for public-listed companies.

Under the proposed exercise, IOIPG REIT will have an initial fund size of 5.5 billion units and acquire nine properties for a total purchase consideration of RM7.58 billion.

The portfolio comprises IOI City Mall and IOI City Towers in IOI Resort City, Putrajaya; PFCC Towers and Four Points by Sheraton Puchong in Bandar Puteri Puchong; Putrajaya Marriott Hotel; Le Méridien Putrajaya; Moxy Putrajaya; W Kuala Lumpur; and Courtyard by Marriott Penang.

The RM7.58 billion consideration will be satisfied through the issuance of 5.5 billion consideration units at 90 sen each and RM2.65 billion in cash, to be funded through sukuk issuance.

The proposed offering, subject to clawback and reallocation provisions, comprises 715.61 million units under a retail offering and up to 1.48 billion units under an institutional offering.

Of the retail offering, 550.61 million units are earmarked for a restricted offer for sale to entitled IOIPG shareholders on the basis of one restricted offer unit for every 10 IOIPG shares held. Another 55 million units are allocated to eligible persons and 110 million units to the Malaysian public.

Under the Aug 19 approval, IRMSB must, within six months from Aug 18, appoint a chief executive, a licensed director, at least two licensed representatives for the relevant fund-management activity and a responsible person for compliance. The approval also carries conditions relating to vetting, conflict-of-interest controls, and ongoing governance and policy reviews.

The proposals remain subject to, among others, approval from Bursa Malaysia Securities for the proposed listing, approval from IOIPG shareholders, approval from the respective vendors’ shareholders for the proposed disposals, and other approvals, waivers or consents where required.

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