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CapitaRetail China Trust fixes IPO at 1.13 sgd per share
[November 30, 2006]

CapitaRetail China Trust fixes IPO at 1.13 sgd per share

(Business Daily Update Via Thomson Dialog NewsEdge) Author: sg CapitaLand said it has fixed the initial public offering (IPO) price of CapitaRetail China Trust's 193.3 million shares at 1.13 sgd, the top end of the guidance range. CapitaRetail China Trust is a real estate investment trust (REIT) that will hold some of CapitaLand's shopping mall assets in China. CapitaLand was earlier looking at pricing the IPO at between 0.95 sgd and 1.13 sgd. The IPO consists of 164.3 million placement shares and 29 million retail shares. Trust manager CapitaRetail China Trust Management Ltd chief executive officer, Lim Beng Chee, said the placement tranche has been 196 times subscribed and the company will exercise its over-allotment option of up to 28.8 million shares. "Based on the offer price of 1.13 sgd, unitholders can expect a forecast distribution yield of 5.4 percent for 2007 and a projected distribution yield of 5.8 percent for 2008," CapitaLand said in a statement. The forecast distribution per unit is 0.0613 sgd in 2007, rising to 0. 0653 in 2008, and further upside possible, Lim added. "A point to note is growth elements such as turnover rents, asset enhancements and acquisitions are not included (in the calculations)," Lim said. CapitaRetail China Trust also has a well defined acquisition growth pipeline, he added. It has the first right of refusal to CapitaLand Retail Ltd's malls in China, as well as the assets of two retail funds: CapitaRetail China Development Fund, investing in retail mall developments in China, and CapitaRetail China Incubator Fund, investing in warehouse retail properties. CapitaRetail China Trust has an initial portfolio of seven malls in five Chinese cities, valued at 690 million sgd, and Lim said there are more than 20 assets proposed which could see it expand into 24 cities, with a porfolio valued at about 3 billion by 2009. "If you look at what we have in the pipeline it is (worth) about 1.4-1.6 billion, and we are going out in the market to buy about 700-800 million (worth of assets). So altogether we will target about 3 billion by 2009," he said. "We are confident we can deliver stable, as well as growing distributions, to our unit holders," he added. The public offer will be launched tomorrow and will close on December 6. Trading in CapitaRetail China Trust shares on the Singapore Exchange is expected to commence on December 8.

Copyright 2006 Business Daily Update Source: Financial Times Information Limited - Asia Intelligence Wire.

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