Frasers Property, controlled by Thai billionaire Charoen Sirivadhanabhakdi, has made a S$1.37bn offer (€941m) to privatise Frasers Hospitality Real Estate Investment Trust (FHT).
The company has offered to pay 71 Singapore cents per share for FHT securities, representing a 7% premium to its last traded price of 66.5c before going into trading halt on Tuesday.
Fraser Property has a 24.33% stake in FHT which owns 14 hotels and serviced residences across nine cities in Asia, Fraser Suites Sydney and Park International London.
FHT has a market capitalisation of S$1.27bn and its portfolio was valued at S$2bn as at September 2024.
Fraser Property first attempted to take private its hospitality arm three years ago but the bid fell short of a 75% shareholder threshold required.
The privatisation proposal came after FHT undertook a strategic review of its business.
Fraser Property said since FHT’s listing in 2014, the trust had faced difficult macroeconomic headwinds, such as weaker foreign exchange rate against the Singapore dollar, higher interest rate environment, global cost inflation and unforeseen events such as Brexit and the COVID-19 pandemic.
Eric Gan, CEO of the manager of FHT, said: “After an evaluation of available options, the proposed scheme emerged as a viable and timely solution to unlock value with strong deal certainty for stapled securityholders to vote in favour of and realise their investments at a premium to NAV.”
Loo Choo Leong, group CEO, Frasers Property, said: “Hospitality is a core business for Frasers Property, and while we remain mindful of near-term challenges facing the hospitality sector, we maintain a long-term investment perspective.
“Leveraging our synergistic multi-asset class capabilities to create value, we will continue to apply our understanding of FHT’s assets to drive performance via active asset and portfolio management.”
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