Circular to Unitholders - Suntec REIT

More documents

Recommendations

Info

Save as disclosed above and based on information available to the Manager as at the Latest Practicable Date, none of the Directors or the Substantial Unitholders 24 have an interest, direct or indirect, in the Acquisition. 4.6 Director’s Service Contracts Following Completion, it is contemplated that each of ORQPL’s shareholders will have a one-third representation on the board of ORQPL. Save as aforesaid, no person is proposed to be appointed as a Director in connection with the Acquisition, the Share Purchase Agreement, the Restated Shareholders’ Agreement or any other transaction contemplated in relation to the Acquisition. 5. METHOD OF FINANCING 5.1 The Financing Plan The Manager proposes to satisfy the Total Acquisition Cost of S$954.6 million and the costs in relation to the financing of approximately S$19.8 million: (i) (ii) partly through the issue of Consideration Units of an aggregate value of S$94.15 million to the Vendor, partly through the issue of Units to the Manager in satisfaction of the acquisition fee of S$9.4 million (being 1.0% of the Agreed Consideration), payable to the Manager pursuant to Clause 15.2 of the Trust Deed (exclusive of GST); and partly with the proceeds of either (iii)(a) the drawdown of Debt Financing for the balance of approximately S$870.9 million, which Suntec REIT is expected to obtain for the purposes of the Acquisition, or (b) the drawdown of the Debt Financing and the Issue of Convertible Bonds, in such proportion as the Manager in its discretion, deems appropriate, to collectively raise the balance of S$870.9 million. Based on market conditions, the Manager will determine the amount of financing to be raised from the Debt Financing and the Issue of Convertible Bonds. The Manager may decide to finance the Total Acquisition Cost 25 by the issue of Consideration Units and a draw down of the Debt Financing, if the Manager determines this to be in the best interests of the Unitholders. 5.2 Suntec REIT’s Existing and Additional Credit Facilities Suntec REIT has a S$700.0 million term loan facility with Platinum AC1 Limited (“Platinum”) and a S$500.0 million term loan facility with Sunshine Assets Limited (“Sunshine”), both of which are special purpose companies held by RBC Dexia Trust Services Singapore Limited and HSBC Institutional Trust Services (Singapore) Limited respectively. As at the Latest Practicable Date, the term loan facility with Platinum is fully drawn and S$215.0 million has been drawn down from the term loan facility with Sunshine in five tranches. To fund their loans to Suntec REIT, Platinum issued floating rate notes with an aggregate face value of S$700.0 million which are rated AAA by Fitch Inc. and Aaa by Moody’s Investors Service, while Sunshine issued a mixture of fixed and floating rate notes with an aggregate face value of S$215.0 million, all of which are rated Baa2 by Moody’s Investors Service. In addition, Suntec REIT has a S$50.0 million revolving credit facility with United Overseas Bank Limited, of which S$7.5 million has been drawn down, and a S$150.0 million revolving credit facility with Citibank N.A., Singapore Branch, which has not been drawn down. 24 25 A person with an interest in one or more Units constituting not less than 5.0% of all outstanding Units. Excluding the acquisition fee of S$9.4 million (being 1.0% of the Agreed Consideration), payable to the Manager pursuant to Clause 15.2 of the Trust Deed (exclusive of GST). 32
The Manager has also put in place additional revolving credit facilities of S$871 million (“Acquisition Facilities”) which will be used, together with the existing credit facilities, to part-finance the Acquisition. 5.3 Suntec REIT’s Leverage As at 30 June 2007 (being the date of the latest unaudited financial statements of Suntec REIT), Suntec REIT has a Leverage Ratio of approximately 23.3%. 26 As at 30 June 2007, the aggregate valuation of the Existing Properties (including the acquisition of 30,172 sq ft of strata office space in Suntec Tower One and Suntec Tower Two between December 2006 and February 2007) was approximately S$3,871.0 million. This is approximately S$659.0 million higher than the aggregate valuation of the Existing Properties as at 30 September 2006. Property Valuation (as at 30 September 2006) (S$ million) Valuation (as at 30 June 2007) (1) (S$ million) Increase (S$ million) Suntec City Mall and Suntec 2,830.0 3,470.0 (3) 640.0 City Office Towers (2) Park Mall (4) 247.0 266.0 19.0 Chijmes (2) 135.0 135.0 0.0 Aggregate for the Existing Properties 3,212.0 3,871.0 659.0 Notes: (1) Based on a valuation undertaken on 31 March 2007. (2) Independent valuation of properties by Knight Frank. (3) Includes 30,172 sq ft of strata office space in Suntec Tower One and Suntec Tower Two acquired between December 2006 and February 2007. (4) Independent valuation of the property by CBRE. Upon Completion, based on Suntec REIT’s Deposited Property of approximately S$4,868.3 million (which takes into account the Deposited Property of the Existing Properties as at 30 June 2007), the drawdown of Debt Financing and/or the Issue of Convertible Bonds are expected to increase Suntec REIT’s Leverage Ratio from approximately 23.3% to approximately 36.6%. 6. PROFIT FORECAST Based on the proposed financing plan described under paragraph 5.1 above, the tables on the following pages summarise Suntec REIT’s forecast consolidated statement of net income of the Existing Properties and the ORQ Interest for the Forecast Year, assuming the Convertible Bonds are issued with an aggregate principal amount of S$450.0 million to part-finance the Total Acquisition Cost 27 . The forecast must be read together with the detailed Profit Forecast as well as the accompanying assumptions and sensitivity analysis in Appendix C of this Circular, and the report of the Independent Accountants on the Profit Forecast in Appendix D of this Circular. 26 27 Suntec REIT’s Aggregate Leverage Ratio, which refers to the ratio of Suntec REIT’s borrowings and deferred payments (including deferred payments for assets whether to be settled in cash or Units) to the value of its Deposited Property, is 28.6% as at 30 June 2007. Excluding the acquisition fee of S$9.4 million (being 1.0% of the Agreed Consideration), payable to the Manager pursuant to Clause 15.2 of the Trust Deed (exclusive of GST). 33
Page 1 and 2: CIRCULAR DATED 18 SEPTEMBER 2007 TH
Page 3 and 4: One Raffles Quay is a prime landmar
Page 5 and 6: 3One Raffles Quay enjoys several ke
Page 8 and 9: Proposed Issue of Convertible Bonds
Page 10 and 11: copy of this Circular has been issu
Page 12 and 13: CORPORATE INFORMATION Directors of
Page 14 and 15: This page has been intentionally le
Page 16 and 17: OVERVIEW OF THE ACQUISITION Descrip
Page 18 and 19: Letter to Unitholders for further d
Page 20 and 21: • Income Diversification The Acqu
Page 22 and 23: aggregate number of new Units and c
Page 24 and 25: SUNTEC REAL ESTATE INVESTMENT TRUST
Page 26 and 27: Approval in-principle has been obta
Page 28 and 29: 2.2 Rationale for the Acquisition T
Page 30 and 31: Scenario A: Forecast DPU (Assuming
Page 32 and 33: Scenario C: Forecast DPU (Assuming
Page 34 and 35: will decrease from approximately 87
Page 36 and 37: Suntec REIT will allot and issue su
Page 38 and 39: 3.6 Asset Management Agreement The
Page 40 and 41: (iv) Suntec REIT has extended one-t
Page 42 and 43: 4.2.2 Pro Forma NAV The pro forma f
Page 44 and 45: (c) the number of Consideration Uni
Page 48 and 49: Forecast Consolidated Statement of
Page 50 and 51: For illustrative purposes only, bas
Page 52 and 53: and the existing Units will be aggr
Page 54 and 55: Accordingly, the Independent Direct
Page 56 and 57: 17. CONSENTS Each of the Independen
Page 58 and 59: Conversion Price : Has the meaning
Page 60 and 61: Hongkong Land : Hongkong Land Limit
Page 62 and 63: Property Funds Guidelines : The gui
Page 64 and 65: Trading Day : A day when the SGX-ST
Page 66 and 67: Based on ORQ Interest Forecast Year
Page 68 and 69: 2.2 Trade Sector Analysis for Exist
Page 72 and 73: Conversion Price : For illustrative
Page 76 and 77: Existing Properties (1) FY2008 S$(
Page 78 and 79: eference to (i) Gross Rent payable
Page 80 and 81: (c) (d) Property Tax It has been as
Page 82 and 83: The percentage of projected gross r
Page 84 and 85: (X) Income Tax Expense The forecast
Page 88 and 89: Events and circumstances frequently
Page 90 and 91: E-2
Page 94 and 95: Cheung Kong or Mr Lim Hwee Chiang,
Page 96 and 97:
The Trustee shall extend the Purcha
Page 98 and 99:
The acquisition fee payable to the
Page 100 and 101:
5. METHOD OF FINANCING 5.1 The Fina
Page 102 and 103:
5.5 The Proposed Issue of Considera
Page 104 and 105:
Office Towers within Suntec REIT’
Page 106 and 107:
Scenario A: Forecast DPU (Assuming
Page 108 and 109:
Scenario C: Forecast DPU (Assuming
Page 110 and 111:
6.5 Valuation of one-third interest
Page 112 and 113:
(4) Forecast net property income pr
Page 114 and 115:
Company Name Date of Circular Type
Page 116 and 117:
(viii) the announcement by K-REIT A
Page 118 and 119:
Singapore-sourced interest income S
Page 120 and 121:
A Qualifying Foreign Non-Individual
Page 122 and 123:
esident in Singapore and who does n
Page 124 and 125:
accordingly. In addition, it is not
Page 126 and 127:
This page has been intentionally le
Page 128 and 129:
ORDINARY RESOLUTION 3. THE PROPOSED
Page 130 and 131:
IMPORTANT: PLEASE READ THE NOTES TO
Page 132:
1 st fold here - - - - - - - - - -
show all

Circular to Unitholders - Suntec REIT

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?