Frasers Hospitality Trust (FHT) is a REIT with 14 properties and 9 cities with a portfolio value of S$2.0 billion. FHT approached its sponsor Frasers Property Limited (FPL) for a proposal to optimise value for its unitholders, and FPL has provided an offer of S$0.70 in cash to privatise FHT.
The offer is at a price to book premium of 1.07x and is also a premium to the trading metrics as below.
The offer is mainly conditional upon FHT’s unitholders and regulatory approval. There is also a material adverse effect clause to protect FPL and allow FPL to not proceed with the offer should FHT’s net tangible assets decline by more than 10% or $125.9 million.
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Similar to any other acquisition, it is currently not compulsory for FHT’s unitholders to tender their units as FPL...