SINGAPORE: OUE Commercial Real Estate Investment Trust said on Monday it would buy OUE Hospitality Trust in a cash-and-stock deal worth S$1.37 billion , creating one of Singapore's largest REITs.
Under the deal, OUE Commercial will issue 1.3583 new shares for every OUE Hospitality share, and pay S$0.04075 per share in cash. The total deal value is a premium of 1.6 per cent to OUE Hospitality's last close.The combined REIT will have total assets of about S$6.8 billion and will trade under OUE Commercial on the Singapore Exchange, the companies said in a joint statement.
The deal will"significantly enhance our visibility within the S-REITs universe and increase our relevance to a wider investor base," said Tan Shu Lin, chief executive officer of OUE Commercial REIT Management Pte Ltd, the manager for OUE Commercial Real Estate Investment Trust. The manager owns a 4.79 per cent stake in OUE Commercial Real Estate Investment Trust, according to Refinitiv Eikon data.
The deal follows a wave of mergers in Singapore's crowded mid-cap real estate investment trusts, that just about a year ago saw ESR-REIT buying rival Viva Industrial Trust in a deal valued at S$936.7 million.OUE Group, which refers to OUE Ltd and its related corporations, will have a 48.3 per cent stake in the combined company, the statement said.
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