HK Land shares rise after property group unveils new $8b real estate fund

Shares of Hongkong Land closed higher last week after the property group unveiled a new $8 billion Singapore private real estate fund and said it will inject its stakes in Marina Bay Financial Centre (MBFC) Towers 1 and 2 and One Raffles Quay into the vehicle.

- Sheila Chiang Business Correspondent

The stock closed at US$7.17 on Dec 12, up 7.34 per cent from the previous week’s closing price of US$6.68.

The fund will focus on managing prime commercial property assets in the Republic and is expected to be the largest private real estate fund here.

The announcement of its launch came a day after the sale of its $1.45 billion stake in MBFC Tower 3 to Keppel Reit on Dec 11.

To fund the acquisition, Keppel Reit launched an underwritten non-renounceable preferential offering to raise about $886.3 million.

An underwritten non-renounceable preferential offering gives existing shareholders the right to buy new shares — typically at a discount — but they cannot sell or transfer this right. If shareholders choose not to subscribe, their ownership may be diluted and the underwriter will take up any unsubscribed shares.

Upon completion of the deal, expected on Dec 31, Keppel Reit’s existing one-third interest, together with the acquired interest, will result in it holding an aggregate two-thirds interest in MBFC Tower 3.

Shares of Keppel Reit closed 7.69 per cent lower at 96 cents on Dec 12, from Dec 5’s closing price of $1.04.

SEMBCORP ANNOUNCES ACQUISITION, SEATRIUM CONSORTIUM WINS CONTRACT

Shares of Sembcorp Industries closed down 1.17 per cent to $5.92 on Dec 12, from the previous week's close of $5.99.

The company on Dec 11 said that it will fully acquire Australian power company Alinta Energy from Chow Tai Fook Enterprises for an agreed enterprise value of A$6.5 billion (S$5.6 billion), which represents the total value of the business, including its debt.

The estimated purchase price is approximately A$5.6 billion and will be paid in cash through Sembcorp's bridge and working capital facilities.

In its bourse filing, the company said that the move will bring "meaningful scale and diversification" to its portfolio across renewables, energy storage and gas assets.