Singapore-listed Acrophyte Hospitality Trust jumps as it ‘evaluates strategic options'
SINGAPORE - A strategic review is underway for Acrophyte Hospitality Trust, formerly known as ARA US Hospitality Trust, as a potential transaction involving its stapled securities is on the table but not guaranteed.
The renaming of the Singapore-listed hotel trust was done in 2024 after the family of billionaire couple Gordon Tang and wife Celine completed their takeover of ARA US Hospitality Trust's managers. Their vehicle for this was Acrophyte, which was known as Chip Eng Seng until the Tangs privatised the company in 2023.
The Tang family also upped their stake to become the trust's largest unit-holder and sponsor.
On May 30, the managers of Acrophyte Hospitality Trust said that they are currently evaluating a 'range of strategic options' in light of the potential capital expenditure needed to enhance its portfolio of hospitality assets in the United States.
'In connection with their evaluation, the managers are also in discussions with the sponsor in respect of a potential transaction involving the stapled securities,' they said.
Despite being in the process of reviewing options, the managers emphasised that 'there is no certainty that any transaction will materialise' from the ongoing review or discussions.
Acrophyte's stapled securities jumped 11.3 per cent, or three cents, to 29.5 cents as at 11.24am on May 30. This after a gain of 7.5 per cent on May 29, before the announcement.
Seven more hotels in Acrophyte's portfolio are slated for asset enhancement initiatives in 2025, after six hotels completed such initiatives in 2024.
Work on two Marriott-branded hotels will commence in June as that on five Hyatt-branded ones will start in November.
The hospitality stapled group comprises Acrophyte Hospitality Property Trust and Acrophyte Hospitality Management Trust.
For the fiscal first quarter of 2025, its revenue declined 7.7 per cent to US$33.5 million from US$36.2 million in the year-ago period amid an 8.3 per cent year-on-year downsizing of its portfolio.
Its Q1 operating profit was 12.8 per cent lower at US$9.3 million, from US$10.7 million in the previous corresponding period. THE BUSINESS TIMES
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