Sep 29, 2022, 00:28 EST
Sep 29, 2022, 00:28 /Comserve / -- A SUBSIDIARY of Straits Trading, Straits Real Estate (SREPL), will spend A$63.5 million (S$60 million) to buy over a 20 per cent stake in the Australia-established ILP No 1 Trust from Canoga Industrial Investment Trust
The deal will be made through its indirect wholly owned subsidiary, SRE Australia Industrial 1 (SREAI1), which already holds 80 per cent of the units in the trust. Upon the transaction’s completion, ILP No 1 Trust, which owns a portfolio of industrial and logistics assets in Victoria and South Australia, will become a wholly owned subsidiary of SREAI1.
The announcement came after the company made known to shareholders its strategy of redeploying capital from its existing property portfolio of high quality but low yielding investment properties into potentially higher return real estate opportunities via SREPL.
In the Friday announcement, Straits Trading said this transaction is “in line with this stated strategy”, while noting that the A$63.5 million consideration will be funded by “internal resources”.
It also disclosed that the transaction will be sealed through a subscription and redemption process. This means SREAI1 will subscribe for new units in the trust, the proceeds of which will be used to redeem Canoga’s existing 20 per cent unitholding in the trust.
The transaction will not have any impact on the issued share capital of Straits Trading, it added.
The company also declared that the deal is not expected to have a material impact on the earnings per share and net tangible asset per share of the group for the current financial year ending Dec 31.
Shares of Straits Trading closed down 0.3 per cent at S$3.21 before the announcement on Friday.
The Straits Trading Company Limited is a Singapore-based corporation with operations in Singapore and Malaysia, as well as various localities in Asia and Australia.
For more information, please contact:Lauren Brown