IOI Properties files Reit listing that may raise RM1.98 billion

[KUALA LUMPUR] IOI Properties Group plans to establish a real estate investment trust (Reit) holding its retail, hotel, and office assets, followed by a listing that could raise about RM1.98 billion (S$645 million) for the Malaysian developer.

The assets, worth a total RM7.58 billion and include properties such as IOI City Mall and W Kuala Lumpur, will be injected into the Reit, according to a stock exchange filing late Friday (Apr 10). The consideration will comprise 5.5 billion units issued at an indicative price of 90 sen each, along with RM2.65 billion in cash.

Founded by late tycoon Lee Shin Cheng, IOI Properties was listed in 2014 and its operations span Singapore and China. The group intends to sell 2.2 billion units to investors through a mix of retail and institutional placements.

At the indicative price, the offering could raise as much as RM1.98 billion, making it Malaysia’s second-largest listing this year after Sunway Healthcare’s US$731 million share sale.

The company said that the listing will enhance asset liquidity by giving the Reit direct access to capital markets for future acquisitions. Proceeds will help IOI Properties repay borrowings, fund development and investment, and increase its debt headroom, it said.

Post-listing, IOI Properties will retain a 60 per cent stake in the Reit. The proposals are expected to be completed by the fourth quarter, subject to shareholder, regulatory and government approvals.