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Mon, December 28, 2020 – 12:50 pm
UNITS of First Real Estate Investment Trust (First Reit) sank on Monday after its manager proposed a rights issue with an indicative issue price of 20 Singapore cents per unit.
As in the noon break, the counter was trading at 27.5 cents, 32.1 percent or 13 cents less than the previous close. It had fallen as much as 33.3 percent or 13.5 cents to 27 cents earlier in the morning.
More than 29.4 million units worth S $ 9.4 million changed hands at noon, more than 12 times the usual daily volume of 2.4 million units traded on average this quarter.
The manager said Monday morning that the issuance of waivable rights, to raise gross proceeds of about S $ 158.2 million, was “critical” for First Reit to meet its debt commitments.
The fundraising exercise will also allow the trust to “avoid imminent default” of 39.8 percent of total debt, or about S $ 196.6 million, due on March 1 of next year.
It proposes to issue around 791.1 million units, which represents 98% of the total units issued as of December 23, pro rata of 98 units of rights for every 100 existing units.
The issue price of 20 cents each has a 50.6 percent discount on the closing price of 40.5 cents on December 24 and a 33.3 percent discount on the theoretical ex rights price of 30 cents. , based on the closing price on December 24th. .
Last month, First Reit also announced the proposed restructuring of the master leases for hospitals leased from Lippo Karawaci, its former parent company.
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