Circular to Unitholders - Suntec REIT

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copy of this Circular has been issued shall not circulate to any other person, reproduce or otherwise distribute this Circular or any information herein for any purpose whatsoever nor permit or cause the same to occur. Neither this Circular nor any copy or portion hereof may be sent or transmitted into the United States or to any U.S. Person (as defined under the United States Securities Act of 1933, as amended (the “Securities Act”)). The Convertible Bonds to be issued by Suntec REIT have, in each case, not been and will not be registered under the Securities Act and may not be offered or sold within the United States or to, or for the account or benefit of U.S. Persons, except in certain transactions exempt from the registration requirements of the Securities Act. The Convertible Bonds are being offered and sold in offshore transactions within the meaning of Regulation S under the Securities Act. Any failure to comply with these restrictions may constitute a violation of United States securities laws. Pro Forma Impact of Deferred Units Issuance Suntec City Development Pte Ltd (“SCDPL”), the vendor of Suntec City Mall and Suntec City Office Towers (both as defined in the prospectus dated 29 November 2004 (the “Prospectus”) issued in connection with the initial public offering of Units from 30 November 2004 to 3 December 2004 and together, the “IPO Properties”) is entitled to be issued with 207,002,170 additional Units (the “Deferred Units”) in part satisfaction of the deferred payment consideration for the purchase for the IPO Properties. The Deferred Units will be issued at the offering price of S$1.00 per Unit under the initial public offering of the Units and in six equal instalments, with the first instalment to be issued on the date falling 42 months after 9 December 2004 (being the date of completion of the sale and purchase of the IPO Properties) and the rest semi-annually thereafter. Any change in rental rates, occupancy rates and Distributable Income (as defined herein) can affect the impact of any dilution in the yields of Suntec REIT arising from the issuance of the Deferred Units in the future. The table below illustrates the pro forma impact on Suntec REIT’s forecast distributions for the financial year ending 30 September 2008 (the “Forecast Year”) under the scenario where the Deferred Units are entirely issued on the Listing Date, the Conversion Units have not been exercised and the Consideration Units have been issued, and in relation to: (i) (ii) Suntec REIT’s existing portfolio of properties (comprising Suntec City Mall, Suntec City Office Towers, Park Mall and Chijmes) (the “Existing Properties”); and the Existing Properties and a one-third interest in One Raffles Quay (the “ORQ Interest”, and together with the Existing Properties, the “Enlarged Portfolio”). Forecast Year (financial year ending 30 September 2008) Existing Properties Enlarged Portfolio Distribution Yield (%) (1) 4.5 4.7 Distribution Yield assuming that all Deferred Units are issued on the Listing Date (%) 4.0 4.2 (1) Includes first instalment of Deferred Units representing 34.5 million units. The above distribution yield is calculated based on (i) an illustrative price of S$1.86 per Unit, being the last closing price on the Latest Practicable Date (as defined herein), (ii) Suntec REIT’s existing portfolio of properties, and (iii) on the Manager’s assumptions as explained in Appendix C of this Circular. Such yields will vary accordingly for investors who purchase Units in the secondary market at a market price different from such illustrative price. ii
TABLE OF CONTENTS Page CORPORATE INFORMATION ............................................... iv SUMMARY ............................................................. 1 INDICATIVE TIMETABLE .................................................. 9 LETTER TO UNITHOLDERS. ............................................... 10 1. Summary of Approvals Sought. .......................................... 10 2. The Acquisition and its Rationale ......................................... 13 3. Details Concerning the Acquisition and Joint Ownership of One Raffles Quay ........ 20 4. Financial Information Relating to the Acquisition .............................. 25 5. Method of Financing .................................................. 32 6. Profit Forecast ....................................................... 33 7. Details of the Issue of Convertible Bonds ................................... 35 8. The Proposed Issue of Consideration Units to the Vendor ...................... 37 9. The General Mandate ................................................. 38 10. The Valuation of Real Estate Supplement. .................................. 39 11. Recommendations .................................................... 39 12. Extraordinary General Meeting. .......................................... 40 13. Prohibition from Voting. ................................................ 40 14. Action to be Taken by Unitholders ........................................ 41 15. Directors’ Responsibility Statement. ....................................... 41 16. Joint Financial Advisers, Underwriters And Bookrunners’ Responsibility Statement .... 41 17. Consents. .......................................................... 42 18. Documents on Display ................................................. 42 GLOSSARY ............................................................ 43 APPENDICES Appendix A One Raffles Quay and the Existing Properties .......................... A-1 Appendix B Principal Terms of the Convertible Bonds. ............................. B-1 Appendix C Profit Forecast ................................................. C-1 Appendix D Independent Accountants’ Report on the Profit Forecast .................. D-1 Appendix E Valuation Certificates. ............................................ E-1 Appendix F Independent Financial Adviser’s Letter ................................ F-1 Appendix G Taxation ...................................................... G-1 Appendix H Proposed Supplement to the Trust Deed .............................. H-1 NOTICE OF EXTRAORDINARY GENERAL MEETING ............................ I-1 PROXY FORM iii
Page 1 and 2: CIRCULAR DATED 18 SEPTEMBER 2007 TH
Page 3 and 4: One Raffles Quay is a prime landmar
Page 5 and 6: 3One Raffles Quay enjoys several ke
Page 8 and 9: Proposed Issue of Convertible Bonds
Page 12 and 13: CORPORATE INFORMATION Directors of
Page 14 and 15: This page has been intentionally le
Page 16 and 17: OVERVIEW OF THE ACQUISITION Descrip
Page 18 and 19: Letter to Unitholders for further d
Page 20 and 21: • Income Diversification The Acqu
Page 22 and 23: aggregate number of new Units and c
Page 24 and 25: SUNTEC REAL ESTATE INVESTMENT TRUST
Page 26 and 27: Approval in-principle has been obta
Page 28 and 29: 2.2 Rationale for the Acquisition T
Page 30 and 31: Scenario A: Forecast DPU (Assuming
Page 32 and 33: Scenario C: Forecast DPU (Assuming
Page 34 and 35: will decrease from approximately 87
Page 36 and 37: Suntec REIT will allot and issue su
Page 38 and 39: 3.6 Asset Management Agreement The
Page 40 and 41: (iv) Suntec REIT has extended one-t
Page 42 and 43: 4.2.2 Pro Forma NAV The pro forma f
Page 44 and 45: (c) the number of Consideration Uni
Page 46 and 47: Save as disclosed above and based o
Page 48 and 49: Forecast Consolidated Statement of
Page 50 and 51: For illustrative purposes only, bas
Page 52 and 53: and the existing Units will be aggr
Page 54 and 55: Accordingly, the Independent Direct
Page 56 and 57: 17. CONSENTS Each of the Independen
Page 58 and 59: Conversion Price : Has the meaning
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Hongkong Land : Hongkong Land Limit
Page 62 and 63:
Property Funds Guidelines : The gui
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Trading Day : A day when the SGX-ST
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Based on ORQ Interest Forecast Year
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2.2 Trade Sector Analysis for Exist
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This page has been intentionally le
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Conversion Price : For illustrative
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Existing Properties (1) FY2008 S$(
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eference to (i) Gross Rent payable
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(c) (d) Property Tax It has been as
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The percentage of projected gross r
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(X) Income Tax Expense The forecast
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Events and circumstances frequently
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E-2
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Cheung Kong or Mr Lim Hwee Chiang,
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The Trustee shall extend the Purcha
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The acquisition fee payable to the
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5. METHOD OF FINANCING 5.1 The Fina
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5.5 The Proposed Issue of Considera
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Office Towers within Suntec REIT’
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Scenario A: Forecast DPU (Assuming
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Scenario C: Forecast DPU (Assuming
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6.5 Valuation of one-third interest
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(4) Forecast net property income pr
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Company Name Date of Circular Type
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(viii) the announcement by K-REIT A
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Singapore-sourced interest income S
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A Qualifying Foreign Non-Individual
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esident in Singapore and who does n
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accordingly. In addition, it is not
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ORDINARY RESOLUTION 3. THE PROPOSED
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IMPORTANT: PLEASE READ THE NOTES TO
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Circular to Unitholders - Suntec REIT

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