SINGAPORE: CapitaLand Ltd, Southeast Asia’s largest developer, is seeking S$2.78 billion (RM6.79 billion) from the listing of its CapitaMalls Asia Ltd unit as it seeks to grow its retail mall business across the region.
Some 1.165 billion shares were being offered at S$1.98 to S$2.39 apiece, according to e-mails sent to investors by sale arrangers Credit Suisse Group AG and Deutsche Bank AG. The share sale will be the biggest in Singapore this year, according to data tracked by Bloomberg.
The listing of CapitaMalls Asia will give investors access to a company that manages 86 retail properties across Asia, including China. The company’s net asset value is estimated at about S$5.3 billion as of Sept 30, according to a prospectus filed with Singapore’s central bank on Nov 2.
“The market is expected to be quiet so this IPO will provide a boost,” said Najeeb Jarhom, an analyst at AmFraser Securities Pte. “Investors have seen CapitaLand’s success in spinning off its property trusts, and fund managers wanting exposure to the China consumption story will be interested.”
CapitaLand has gained 13% since it announced plans to list the unit on Oct 5. The Singapore benchmark Straits Times Index has added 1.5% in the period.
If it’s priced at the top end of the range, the share sale may be the largest IPO in the city-state since Singapore Telecommunications Ltd’s initial offering in 1993, which raised more than S$4 billion, a record for the island. The 17 share sales in Singapore this year have raised an average S$17.3 million, according to data tracked by Bloomberg.
The developer said on Nov 2 it filed a preliminary prospectus for CapitaMalls Asia and will start meeting institutional investors to gauge demand, according to a filing to the Singapore stock exchange.
CapitaMall Asia’s portfolio includes the Ion Orchard shopping mall in Singapore, a project jointly developed with Hong Kong’s Sun Hung Kai Properties Ltd. The mall, which opened in July, counts LVMH Moet Hennessy Louis Vuitton SA’s Louis Vuitton, and Fast Retailing Co’s Uniqlo chain among its tenants.
The company also owns about 50 retail properties in China, of which 18 are currently under development. China provides “significant opportunities” for the growth of the business, CapitaMalls Asia said in the prospectus.
CapitaLand said on Oct 5 it will retain majority control of the unit following the share sale and for the “foreseeable future”.
The share sale will allow CapitaMall Asia to undertake expansion plans, including the acquisition of land for new developments, the purchase of completed malls, asset enhancement initiatives as well as buying existing portfolios of retail properties, the developer said last month.
It may recommend a special dividend for its shareholders following the listing, the company added. – Bloomberg LP
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