CapitaLand to take CapitaMalls Asia private for S$3.06b

KUALA LUMPUR: Singapore-based CapitaLand Ltd has proposed to take its 65.3%-owned subsidiary CapitaMalls Asia Ltd (CMA) private via a voluntary conditional cash offer of about S$3.06 billion (RM7.9 billion) for the remaining ordinary shares in the latter.

CMA is linked to CapitaMalls Malaysia Trust (CMMT), a Malaysia-based real estate investment trust (REIT) that has four shopping malls in the country — Gurney Plaza in Penang, Sungei Wang Plaza in Kuala Lumpur, The Mines in Selangor and the East Coast Mall in Kuantan, Pahang — in its portfolio.

CMA, one of Asia’s leading shopping mall developers, owners and managers, is partnering Sime Darby Property Bhd in a 50:50 joint venture to develop a shopping mall in Taman Melawati, Kuala Lumpur.

In an announcement to the Singapore Exchange (SGX) yesterday, CapitaLand said its wholly-owned subsidiary, Sound Investment Holdings Pte Ltd, will make a voluntary conditional cash offer with a view to delist CMA, which is listed on the SGX and the Hong Kong stock exchange.

The offer is conditional upon Sound Investment receiving acceptances that will result in the company and parties acting in concert holding more than 90% of CMA shares. The earliest closing date for the offer is end-May or June.

As at Feb 21, the other substantial shareholders of CMA are Citibank Nominees Singapore Pte Ltd (7.05%), DBS Nominees Pte Ltd (6.93%), DBSN Services Pte Ltd (6.29%) and HSBC (Singapore) Nominees Pte Ltd (3.05%).

CapitaLand said its S$2.22 per share offer represents a 27% premium to CMA’s volume weighted average price for the last one month and a 20.7% premium to the net asset value per share as at Dec 31, 2013.

It plans to fund the share acquisition through a combination of internal cash resources and borrowings of the CapitaLand group, excluding those of the CMA group.

CapitaLand, 39%-owned by Temasek Holdings, said the proposed privatisation of CMA will significantly enhance its competitive strengths in integrated developments, simplify its organisational structure and unlock shareholder value.

CMA currently has S$26.7 billion of assets under management across Asia. A Reuters report said the company manages 105 shopping malls and earned 43% and 32% of its revenue from China and Singapore respectively last year. Most of the remaining revenue comes from Japan and Malaysia.

CMA recorded a profit after tax and minority interest of S$600 million for FY13 ended Dec 31, 9.9% higher than the S$546 million recorded in FY12.

Its Malaysian portfolio has a total net lettable area of more than 2.5 million sq ft and valued at about RM3.1 billion. As at Dec 31, 2013, CMMT had a market capitalisation of about RM2.5 billion.

CMA is linked to CapitaMalls Malaysia Trust, a Malaysia-based real estate investment trust that has four shopping malls in the country, including Gurney Plaza in Penang.

This article first appeared in The Edge Financial Daily, on April 15, 2014.