Sep 23, 2020
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Kevin Chee, CEO of the CCT Manager (middle) and Mr Tony Tan, CEO of the CMT Manager (right) responded to feedback and queries from unitholders during the Q&A segments moderated by Mr David Gerald (left), Founder, President and CEO of SIAS. Photo: CapitaLand

More than 200 retail unitholders participated in the separate virtual dialogue sessions held by CapitaLand Mall Trust (CMT) and CapitaLand Commercial Trust (CCT) on 17 and 18 September.

Facilitated by the Securities Investors Association (Singapore) (SIAS), the dialogue sessions are part of CMT and CCT’s efforts to engage retail investors on the merits of the proposed merger, which is expected to create a diversified commercial real estate investment trust (REIT) that will be known as ‘CapitaLand Integrated Commercial Trust’ (CICT).

During the sessions, Tony Tan, CEO of the CMT Manager, underscored that the merged entity will benefit from the trend towards integrated developments and mixed-use precincts, which is expected to accelerate post-Covid-19.

“Westgate is an example of opportunities arising from the development of Jurong Gateway as a regional centre. Under the URA Master Plan 2019, we are going to see more regional centres sprouting up around Singapore. At the same time, URA has also introduced initiatives like the CBD Incentive Scheme and the rejuvenation of Orchard Road in order to transform these areas into mixed-use precincts,” he said.

Kevin Chee, CEO of the CCT Manager, on the other hand, noted that while CCT and CMT’s retail and institutional investors may have different investment strategies and styles, they share a common denominator – the focus on investment returns.

“That’s what both CCT and CMT are driven toward, to deliver sustainable long-term returns to unitholders. For us to do that, we cannot sit still. We need to evaluate opportunities and assess the landscape that we are in. We need to understand the shifts and ebbs in demands and preferences, and make sure we fortify our platform, so we can deliver that growth and investment return that investors want,” he said.

According to him, proposed merger is “about creating a strategic, transformative merger to proactively address these concerns, so we can continue to deliver sustainable returns”.

Chee also explained that the scheme consideration of 0.720 new CMT units and $0.2590 in cash for every CCT unit “reflects a market-to-market valuation of CCT and CMT”.

“As a merger of equals, the scheme consideration is aimed at achieving a balanced and attractive outcome for both CCT unitholders and the CMT unitholders, as well as resulting in a merged entity that will be well positioned to capitalise on future opportunities,” he said.

Upon completion of the proposed merger, Tan expects a pro forma gearing of around 39.7% which is within a manageable range in the short-term.

“We will proactively review the merged entity’s business and capital management plans to ensure an optimal capital structure through cycles. We have been disciplined in managing our leverage profile and will continue to do so.”

Meanwhile, Chee assured that the CCT Manager will “facilitate the trading of odd lots of CMT units so that CCT unitholders who wish to round up or down their holdings to the nearest 100 CMT units can do so”.

To facilitate odd lots trades from 28 October to 11 December, arrangements have been made with three brokerage firms, namely Phillip Securities, UOB Kay Hian and OCBC Securities.

Given the Covid-19 situation, the CMT EGM as well as CCT’s EGM and the Trust Scheme Meeting will be held via electronic means.

The two CEOs called on CMT and CCT unitholders to pre-register for their respective virtual unitholders’ meetings as well as provide voting instructions via proxy forms.

To vote, unitholders are required to complete and sign their respective proxy forms and submit them to the CCT and CMT unit registrars via email or by post 48 hours prior to the respective times of meetings on 29 September.

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Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg

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