Stocks to watch: CDL, Keppel Reit, Paragon Reit, BRC Asia, Frasers Hospitality Trust
[SINGAPORE] The following companies saw new developments that may affect trading of its securities on Wednesday (Apr 23).
City Developments Limited (CDL): The developer's wholly owned subsidiary has increased its offer to buy the shares of Millennium & Copthorne Hotels New Zealand (MCK) that it does not already own to NZ$2.80 apiece. In a letter to MCK shareholders on Tuesday, CDL said the new price is 'the final and best' that its subsidiary, CDL Hotels Holdings New Zealand, is willing to pay. The company will not change the price again and neither will it make another offer within nine months. The higher offer reflects a 60 per cent premium to the one-month volume weighted average share price of NZ$1.75. On Tuesday, MCK said its independent directors committee was assessing the higher offer and will provide a recommendation to shareholders by Apr 28. Shares of CDL closed 2.1 per cent or S$0.10 higher at S$4.84 on Tuesday, before the announcement.
Keppel Real Estate Investment Trust (Reit): The Reit manager reported on Wednesday a net property income growth of 13.3 per cent year-on-year to S$54.6 million in Q1 of 2025. The manager said this increase is due to better performance of the Singapore properties in the central business district, increased occupancy at 2 Blue Street, as well as contribution from 255 George Street. The Reit's distributable income, including an anniversary distribution, fell 3.2 per cent year-on-year to S$53.4 million. Units of Keppel Reit closed S$0.005 or 0.6 per cent higher at S$0.83 on Tuesday.
Paragon Reit: The Reit's unitholders approved the scheme resolution proposed by Cuscaden Peak's Times Properties to take the trust private. Its delisting is expected on Jun 6, subject to regulatory approval. During the scheme meeting on Tuesday, around 82.8 per cent of those present and voting, agreed to the privatisation offer, representing about 97.6 per cent of units. The scheme resolution was also contingent on the approval of amendments made to the Paragon trust deed. The last day of trading for the counter is expected to be on or around May 14, followed by its record date on May 23 at 5 pm. Paragon Reit unitholders will receive the scheme consideration of S$0.98 a share in cash on or around Jun 4. Paragon Reit called for a trading halt on Tuesday morning and requested to lift it on Wednesday morning. The counter last closed on Monday 0.5 per cent or S$0.005 lower at S$0.97.
BRC Asia: The steel fabricator said on Tuesday that it has entered into a conditional share purchase agreement to buy a controlling stake of 55 per cent in Southern Steel Mesh. BRC Asia will buy 12.9 million shares from the company's parent Southern Steel, for a cash consideration of RM61 million (S$18.2 million). The parent will retain a minority stake. BRC's shares closed down S$0.04 or 1.3 per cent at S$3.03, before the announcement.
Frasers Hospitality Trust (FHT): The managers of the trust are conducting a review of FHT's strategy, the company said on Wednesday. As part of this review, various options, including exploring options with the sponsor of FHT, are being considered to ensure alignment with the interests of stapled security holders. While the managers are exploring these options, there is no certainty or assurance that any transaction in respect of the stapled securities will arise. The managers may decide to continue with FHT's existing business strategy, the statement said. Units of FHT closed on Tuesday 1.7 per cent or S$0.01 higher at S$0.60.
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Business Times
2 days ago
- Business Times
Who is behind Malaysia's IOI Properties Group?
[SINGAPORE] Property developer IOI Properties Group (IOIPG) is poised to grow its Singapore presence with the acquisition of the remaining 50.1 per cent stake in the South Beach development that it does not already own, from its joint venture partner City Developments (CDL). Upon the S$834.2 million acquisition, slated to complete by Q3 2025, IOIPG will gain full ownership of South Beach's commercial components, the group said in a Wednesday (Jun 4) bourse filing. This includes the 34-storey South Beach Tower housing Grade-A office units, the 634-room JW Marriott Hotel Singapore South Beach, and the restaurants and cafes in the complex. The mixed-use integrated development along Beach Road is now owned by both parties via an entity called Scottsdale Properties, which owns South Beach Consortium, which in turn owns South Beach. The acquisition, one of CDL's largest divestments, will expand IOIPG's Singapore investment property portfolio – even as it is already a major player in the city-state's real estate space. IOIPG has developed projects such as the IOI Central Boulevard Towers in the Marina Bay area. Nearby, in the pipeline is W Singapore - Marina View, a 350-room hotel slated to open in late 2028. Branded apartments W Residences - Marina View will be part of the 51-storey mixed-used development. Lee Yeow Seng, IOI's group chief executive officer, said: 'This acquisition will elevate the group's profile as a major landlord of premium office space and a prominent player in the hospitality industry within the Republic.' A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up The deal will bring the total net lettable area (NLA) of IOI's Singapore investment assets to 1.8 million square feet (sq ft) and the total NLA of its property investment segment across Malaysia, Singapore and Xiamen, China, to 9.82 million sq ft. IOI's total assets across investment properties, hotel assets and property development assets stood at RM47.93 billion as of Mar, 31, 2025. News of the South Beach sale comes on the heels of CDL's announcement of its plans to divest assets in a bid to cut debt. The Business Times explains who is behind IOIPG, and throws light on its diverse portfolio of property developments in Singapore. What is IOI Group? The group is a Malaysian conglomerate that started off as a palm oil business before venturing into property. Its palm oil business is parked under IOI Corporation, one of Malaysia's largest palm oil companies; its property business is handled by IOIPG, the property arm of IOI Corporation. One of Malaysia's largest property entities by market capitalisation, IOIPG was carved out of IOI Corporation, and separately listed on the Malaysian stock exchange in January 2014. IOIPG has three core business segments: Property development, property investments and hospitality and leisure in the markets of Malaysia, Singapore and Xiamen, China. It has four-decades of experience in property development across residential, commercial and industrial offerings. IOI Corporation is among the 30 largest companies listed on the main board of the Malaysian stock exchange, and a constituent company on the bourse's benchmark index, the FTSE Bursa Malaysia KLCI. Who is IOI's founder, and who runs the business now? The late Malaysian magnate Lee Shin Cheng, who died in 2019, founded IOI Corporation and its property arm IOIPG, which is also listed on Bursa Malaysia. Born in 1939 in Kuala Selangor in the Malaysian state of Selangor, he was raised on a poor rubber plantation. He dropped out of school at 11 and started selling ice cream to support his family. He began working as a supervisor in a rubber estate at the age of 17, and worked his way up to becoming an estate manager before he turned 30. In 1975, he acquired a property company and over the years, developed the business. In 1982, he acquired Industrial Oxygen Incorporated. Renamed as IOI Corporation in 1995, it ventured into the palm oil business. After his death, his sons inherited stakes in IOI Group. Lee Yeow Chor is group managing director and chief executive of IOI Corporation, and Lee Yeow Seng is the group CEO of IOIPG. What other Singapore assets does IOIPG own? Beyond the integrated developments, IOIPG has a portfolio of high-end residential properties in Singapore. These include Seascape and Cape Royale, condominium developments in Sentosa Cove that were developed in partnership with Ho Bee Land. IOIPG also developed The Trilinq, a residential development in Clementi and Cityscape@Farrer Park. Last November, Lee Yeow Seng acquired Shenton House along Singapore's Shenton Way, in his personal capacity, for S$538 million.
Business Times
2 days ago
- Business Times
CDL selling its 50.1% South Beach stake to its Malaysian partner IOI for S$834 million, yielding S$465 million gain
[SINGAPORE] City Developments Limited (CDL) has agreed to sell its 50.1 per cent stake in the South Beach mixed project to its Malaysian partner, IOI Properties Group (IOIPG), for about S$834.2 million. The deal values the complex at about S$2.75 billion, which represents a premium of about 3 per cent over the most recent valuation of S$2.67 billion as at Dec 31, 2024. The transaction is expected to result in a gain on disposal of about S$465 million for the financial year ending Dec 31, 2025, CDL said on Wednesday (Jun 4). IOIPG will take full ownership of South Beach's commercial components upon completion in the second half of 2025. CDL added that the sale price was based on 50.1 per cent of the consolidated net assets of Scottsdale Properties, which owns South Beach Consortium, which in turn owns South Beach. IOI noted in a bourse filing that Scottsdale's liabilities of S$1.16 billion were also factored in. Cash proceeds from the proposed divestment will enable CDL to reduce bank borrowings and improve its net gearing ratio, the group said. Capital from the sale will also be used to pursue new acquisitions, invest in upcoming pipeline development projects and optimise capital management. Assuming that the deal had been completed at the end of FY2024, the group's net gearing ratio would have fallen to 103 per cent, from 117 per cent, CDL said. It would have logged earnings of S$638.5 million, up from S$190.8 million, had the deal been completed at the beginning of FY2024. Earnings per share would have risen to S$0.712, from S$0.213. A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up CDL's board believes the sale supports positive returns for the group's business and aligns with its strategic focus on capital recycling. It said the Beach Road property has reached maturity and has been delivering 'strong occupancy and stable income'. Sherman Kwek, CDL's group chief executive, said: 'Having fulfilled our vision for South Beach – from securing the land site via a rigorous tender process in 2007, navigating macroeconomic challenges, to transforming it into the high-performing, stabilised asset it is today – it is now time to crystallise its value.' The Norman Foster-designed project in Singapore's Central Business District includes retail space, a 34-storey office tower and a 45-storey building housing JW Marriott Hotel Singapore. As at Mar 31, South Beach's office and retail components posted committed occupancy of 92.4 per cent and 92.5 per cent, respectively, CDL said on Wednesday. Major tenant Meta Platforms last year gave up seven floors of space at the office tower; the exit brought occupancy down to 92.4 per cent from 94.4 per cent at the end of last year. CDL acquired the site through a government land sale for nearly S$1.7 billion in 2007, with two foreign partners – a unit of state-owned Dubai World, and El-Ad Group. Based on a Bloomberg report, the global financial crisis led to a years-long delay in construction. The two partners exited the project, with IOIPG eventually taking a minority stake in 2011. Kwek Leng Beng, executive chairman of CDL, resisted letting IOIPG take an equal stake in order to maintain control, based on a biography published in 2023, Bloomberg said. In CDL's statement on Wednesday, the elder Kwek said: 'South Beach began as a bold vision to enhance Singapore's reputation as a global city, attract international investors and create a new icon that blends modern, sustainable architecture while preserving the site's conserved buildings.' IOIPG group CEO Lee Yeow Seng said: 'The acquisition of a 100 per cent equity stake in this landmark development marks a significant strategic expansion for IOIPG in Singapore. Combined with the IOI Central Boulevard Towers and W Singapore Marina View hotel, this acquisition will elevate the group's profile as one of the major landlords of premium office space and a prominent player in the hospitality industry within the Republic.' The Malaysia-listed group is controlled by the Lee family, which made its fortunes from palm oil. CDL shares were up 2.1 per cent or S$0.10 at S$4.97 on Wednesday as at 3.24 pm, after its trading halt was lifted. The group said in 2024 that it aimed to divest S$1 billion in assets, and has announced about S$600 million in divestment so far. News of the South Beach sale comes in the wake of a public feud between father and son in CDL's Kwek family, which erupted in late February. While they have since buried the hatchet, the younger Kwek acknowledged at CDL's annual general meeting in April that the dispute had hurt shareholders' confidence. He also identified reducing the growing debt load as a priority.
Business Times
2 days ago
- Business Times
CDL selling its 50.1% South Beach stake to partner Malaysia's IOI for S$834 million, yielding S$465 million gain
[SINGAPORE] City Developments Limited (CDL) has agreed to sell its 50.1 per cent stake in the South Beach mixed project to partner Malaysia's IOI Properties Group (IOIPG) for about S$834.2 million. The deal values the complex at about S$2.75 billion, which represents a premium of about 3 per cent over the latest valuation of S$2.67 billion as at Dec 31, 2024. The transaction is expected to result in a gain on disposal of about S$465 million for the financial year ending Dec 31, 2025, CDL said on Wednesday (Jun 4). IOIPG will take full ownership of South Beach's commercial components upon completion in the second half of 2025. CDL added that the sale price was based on 50.1 per cent of the consolidated net assets of Scottsdale Properties, which owns South Beach Consortium, which in turn owns South Beach. It also takes into account an agreed property value of S$2.75 billion and Scottsdale's liabilities of S$1.16 billion. Cash proceeds from the proposed divestment will allow CDL to reduce bank borrowings and improve net gearing ratio, the group said. Capital from the sale will also be used to pursue new acquisitions, invest in upcoming pipeline development projects and optimise capital management. Assuming that the deal had been completed at the end of FY2024, the group's net gearing ratio would have fallen to 103 per cent, from 117 per cent, CDL said. It would have logged earnings of S$638.5 million, up from S$190.8 million, had the deal been completed at the beginning of FY2024. Earnings per share would have risen to S$0.712, from S$0.213. A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up CDL's board believes the sale supports positive returns for the group's business and aligns with its strategic focus on capital recycling. It said the Beach Road property has reached maturity and has been delivering 'strong occupancy and stable income'. Sherman Kwek, CDL's group chief executive, said: 'Having fulfilled our vision for South Beach – from securing the land site via a rigorous tender process in 2007, navigating macroeconomic challenges, to transforming it into the high-performing, stabilised asset it is today – it is now time to crystallise its value.' The Norman Foster-designed project in Singapore's Central Business District includes retail space, a 34-storey office tower and a 45-storey building housing JW Marriott Hotel Singapore. As at Mar 31, South Beach's office and retail components posted committed occupancy of 92.4 per cent and 92.5 per cent, respectively, CDL said on Wednesday. Major tenant Meta Platforms last year gave up seven floors of space at the office tower, with the exit bringing occupancy down to 92.4 per cent, compared with 94.4 per cent at the end of last year. CDL acquired the site at a government land sale for nearly S$1.7 billion in 2007, with two foreign partners – a unit of state-owned Dubai World, and El-Ad Group. Based on a Bloomberg report, the global financial crisis led to a years-long delay in construction and the two partners exited the project, with IOIPG eventually taking a minority stake in 2011. Kwek Leng Beng, executive chairman of CDL, resisted allowing IOIPG to take an equal stake in order to maintain control, based on a biography published in 2023, Bloomberg said. In CDL's Wednesday statement, the elder Kwek said: 'South Beach began as a bold vision to enhance Singapore's reputation as a global city, attract international investors and create a new icon that blends modern, sustainable architecture while preserving the site's conserved buildings.' IOIPG group CEO Lee Yeow Seng said: 'The acquisition of the 100 per cent equity stake in this landmark development marks a significant strategic expansion for IOIPG in Singapore. Combined with the IOI Central Boulevard Towers and W Singapore – Marina View hotel, this acquisition will elevate the group's profile as one of the major landlords of premium office space and a prominent player in the hospitality industry within the Republic.' The Malaysia-listed group is controlled by the Lee family, which made its fortunes from palm oil. CDL shares were up 2.1 per cent or S$0.10 at S$4.97 on Wednesday as at 3.24 pm, after its trading halt was lifted. The group said in 2024 that it aimed to divest S$1 billion in assets, and has announced about S$600 million in divestments so far. News of the South Beach sale comes in the wake of a public feud between father and son in CDL's Kwek family, which emerged in late February. While they have since buried the hatchet, the younger Kwek acknowledged at CDL's annual general meeting in April that the dispute had hurt shareholders' confidence, and said reducing the growing debt load is a priority.
