Cromwell Property Group has announced the successful initial public offering of its €1.3 bn Cromwell European Real Estate Investment Trust (CEREIT) on the main board of Singapore Stock Exchange, after a false start in September.
Cromwell's wholly owned subsidiary, Cromwell EREIT Management, the manager of CEREIT, raised gross proceeds of €865.7 mln from the oversubscribed IPO on Singapore Exchange Securities Trading Limited (SGX-ST). This is lower than what the company hoped to raise during the abortive attempt to IPO the REIT a few months ago.
The property group offered 428.5 million shares in CEREIT at €0.55 per share last week. Cromwell's stake of 35.8%, and assuming the over-allotment option is not exercised, is valued at €310 mln.
'The successful IPO of CEREIT is an innovative and transformative deal,' said Paul Weightman, CEO of Australia-based Cromwell Property Group. The group completed the integration of Valad Europe into the wider group in February this year.
'It's the first Euro-denominated REIT on the SGX-ST and the largest REIT IPO in Asia since 2013 by market capitalisation, Weightman said. 'CEREIT also secures one third of our existing European assets under management (AUM) with longer term capital, and allows us to grow our platform in Italy, the Eurozone's third largest economy, with an additional €400 million in assets under management,' he added.
Cromwell had a market capitalisation of AU$1.7 bn at end-December 2016, a direct property investment portfolio in Australia valued at AU$2.4 bn and total assets under management of AU$9.8 bn across Australia, New Zealand and Europe.
Portfolio
CEREIT's initial portfolio comprises 74 properties with an aggregate lettable area of 1.1 million m2 and a total appraised value of €1.3 bn at end-April 2017. The properties are located across five countries in Europe (Denmark, France, Germany, Italy and the Netherlands) with a focus on the office and light industrial/logistics sectors.
Investors
The REIT's cornerstone investors include Cerberus Singapore, Hillsboro Capital and Gordon Tang and Celine Tang.
Hillsboro Capital is a private investment holding company of Dr. Andrew Tan and his family. Dr. Tan is the Chairman and CEO of Alliance Global Group, a listed conglomerate in the Philippines. The group's interests span property development, food and beverage manufacture and distribution, quick-service restaurants and integrated tourism development businesses.
Gordon Tang is a non-executive director of SingHaiyi Group Limited, which is listed on the main board of the SGX-ST and specialises in property development, real estate investment, real estate co-investing and real estate management services. Celine Tang is the Group managing director of SingHaiyi Group.
