Channel News Asia
AIMS AMP plans purchase of warehouse for S$161m
By Mok Fei Fei | Posted: 23 August 2010 1639 hrs
Singapore-listed AIMS AMP Capital Industrial REIT has proposed to buy a warehouse in Singapore for S$161 million.
AIMS AMP plans to buy the warehouse and logistics facility located at Penjuru Lane from AMP Capital Business Space REIT.
As AMP Capital Business Space REIT is indirectly wholly-owned by AMP Capital, who is a Controlling Unitholder of AIMS AMP, the acquisition is considered to be a related party transaction.
It said the proposed purchase is below the independent valuations of S$162.5 million and S$165 million made by two property consultants.
AIMS AMP said the property is a high quality "ramp up" warehouse that will enjoy competitive operational and cost advantages in attracting users.
It added that the purchase is in line with its principal investment strategy to invest in quality income-producing industrial real estate assets.
The money to fund the purchase will come from a combination of debt and equity financing.
AIMS AMP has accepted a letter of commitment for a new debt facility of S$280 million from three banks, namely Standard Chartered, UOB and Commonwealth Bank of Australia
AIMS AMP will also issue around 513.3 million new units through a fully underwritten and renounceable rights issue.
Current unitholders can buy 7 rights units for every 20 existing units held at a price of 15.5 per rights unit.
At that price, it represents a 32.6 percent discount to last Thursday's closing price of 23 cents per unit.
AIMS AMP expects to raise gross proceeds of S$79.6 million from the rights issue.
It said its sponsors and several unitholders, including Dragon Pacific Assets and Hunter Hall Investment Management, have committed to subscribe for their pro rata rights entitlements.
The proposed transactions are subject to an extraordinary general meeting to be held on 13th September. - CNA/ch