OUE Commercial Real Estate Investment Trust (OUE C-Reit) and OUE Hospitality Trust (OUE H-Trust) are proposing to merge in a cash and stock deal that will create one of Singapore’s largest Reits with total assets of about SGD 6.8 billion.
Under the proposed scheme, OUE C-Reit will acquire OUE H-Trust by paying OUE H-Trust holders, for every OUE H-Trust stapled security held, SGD0.04075 in cash plus 1.3583 new OUE C-Reit units. OUE C-Reit will pay a total of about SGD74.6 million in cash, and issue about 2.5 billion new units to OUE H-Trust holders. Based on OUE C-Reit’s closing price of SGD0.52 on Friday, the 2.5 billion units would be worth about SGD 1.3 billion.
Parent company OUE Group will continue to retain a 48.3% stake in the enlarged Reit. OUE shares closed at SGD 1.77 on Friday.
The merged entity will be one of Singapore’s largest Reits by assets.