E-Shang Redwood (ESR) has begun acquiring shares in Sabana Shariah Compliant Industrial REIT, two months after calling off merger talks with the trust.

Sabana said ESR Cayman has acquired a further 1.4m securities, lifting its total holdings to 8.07% stake in the Singapore-listed real estate investment trust (REIT).

According to Sabana’s disclosure filings, the pan-Asian logistic group’s unit began buying shares in February and again in March.

It is understood that when ESR first began its on-off negotiations to merge its own Singapore-listed ESR REIT with Sabana at least nine months ago, the suitor already had a stake of around 5%.

In November, Sabana informed the market that it had ceased talks with ESR, and instead was exploring options related to the strategic review. 

Sabana owns a diversified portfolio of 19 properties covering high-tech industrial, warehousing and logistics valued at around SGD1bn (€617m). It has a market capitalisation of SGD442m.

ESR REIT, backed by Warburg Pincus, is currently in exclusive talks with another Singapore-listed REIT, Viva Industrial Trust, proposing to merge all of Viva with ESR REIT through a trust scheme of arrangement.

ESR and Warburg Pincus have also been looking to establish an Australian platform.

ESR currently owns significant stakes in two listed Australian entities, Propertylink Group and Centuria Capital Group.

It is believed that discussions between Warburg Pincus and Centuria are ongoing to work a deal between them to take over Propertylink and split its assets.

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