PROPERTY developer CapitaLand’s latest unit to list, CapitaMalls Asia (CMA), has attracted huge interest in its initial public offering (IPO) – with the public tranche nearly five times subscribed.
Once the process is completed, it is set to raise $2.8 billion, making the integrated shopping mall business unit the largest IPO here in 16 years.
CapitaLand said yesterday that shareholders may be in for a special dividend.
CMA owns 86 retail properties – 59 completed shopping malls and 27 under development – in Singapore, China, Japan, Malaysia and India. They are worth about $20 billion.
CapitaLand said in a statement to the Singapore Exchange that the public offer component of 95 million shares at $2.12 apiece was 4.9 times subscribed. It had raised $988.5 million from 44,507 valid applications at the close of the public offer at noon on Monday. The shares begin trading today.
All of its 11.652 million reserved shares were applied for by the directors, management, employees and business associates of the CapitaLand Group, including CMA and its units.
About $24.7 million was received for the reserved shares, the firm said.
CapitaLand received 2.5 times the demand for the more than one billion shares in the placement tranche, which amounted to about $5.54 billion of potential sales. In view of the strong demand, about 174 million shares were over-allotted.
This was covered through shares borrowed by JP Morgan from CapitaLand, pursuant to a share lending agreement.
Upon completion of the IPO and assuming the full exercise of the over-allotment option, CapitaLand’s shareholding interest in CMA will be reduced from 100 per cent to 65.5 per cent, said the firm.
CapitaLand chairman Richard Hu said that with the listing, ‘we will unlock value for our shareholders even as we embark on the next phase of growth for CapitaLand’.
He said the group may declare a special dividend to shareholders, after taking into account the net proceeds of the listing and the growth strategies of other CapitaLand units and their capital requirements.
Group president and chief executive Liew Mun Leong said the strong response from international institutional investors, particularly from the United States and Europe, demonstrated a flow of funds ready and keen to invest in Asia’s consumer economy.
‘CapitaMalls Asia’s IPO enables these international funds to invest in a pan-Asian shopping mall portfolio of assets,’ he said.
Source: Straits Times, 25 Nov 2009