PETALING JAYA: Real estate investment trust (REIT) Amanah Harta Tanah PNB (AHTP) is proposing to acquire a three-storey mall in Seremban for RM240mil.
MIDF Amanah Investment Bank Bhd said in a stock exchange filing on behalf of Pelaburan Hartanah Nasional Bhd (PHNB), the REIT manager, that a conditional sale and purchase agreement with Mydin Mohamed Holdings Bhd had been signed to acquire the property, which sits on a 13.38-acre freehold plot.
“The proposed acquisition is in line with the objective of the manager to enhance its acquisition strategy to provide reasonable level of income return to unit holders and allow to gain from capital growth.”
The investment bank said the acquisition would be accretive on a per-unit distribution basis and would provide AHTP with additional stable and sustainable income stream – pursuant to the leaseback agreement with Mydin with a committed lease of 30 years.
“The proposed acquisition will grow the size of AHTP, thus providing further opportunities for growth of the fund, potential capital appreciation of units and increased units in circulation for the potential trading in the market, which are all for the benefit of unit holders.”
However, MIDF noted that the property may be affected by the increased competition from other retail malls.
“This could in turn have an adverse impact on AHTP’s future earnings and results of operations. However, the risk is mitigated in view that the property will be leased for 30 years on agreed rental rates.”
To part-finance the acquisition, AHTP has proposed to raise RM129.60mil via a renounceable rights issue on the basis of six rights units for every five existing units, at an entitlement date to be determined later.
MIDF said about RM115mil of the proceeds from the rights issue would be used to finance the acquisition, while the remaining RM14.6mil would be for the expenses of the rights exercise.
It added that the remaining RM125mil of the land cost would be financed through bank borrowings.