Thursday, November 24, 2011

Pavilion REIT Updated

FinanceAsia:  Pavilion Real Estate Investment Trust is set to raise M$710 million ($228 million) from its initial public offering after fixing the price at the top of the range at M$0.90 per unit for institutional investors, according to sources.
The retail tranche, which accounts for 4.4% of the deal, was priced at M$0.88 per unit. About 35% of the institutional portion was allocated to six cornerstone investors, which include domestic pension funds and insurance companies as well as pan-Asian insurer AIA. At the final price, the rest of the 95.6% institutional tranche was nearly 30 times covered, one source said.

The strong interest in Pavilion Reit is believed to have been underpinned by the defensive nature of Reits, which typically yield stable revenues and pay high dividends, particularly as global markets remain highly volatile.

Although the company received almost an equal amount of demand from international and domestic investors, it has allocated almost 70% to local players. The reason, the source said, is to ensure domestic support in the aftermarket as there is no greenshoe option to help stabilise the performance.
Analysts say liquidity provided by local funds tends to help deals in countries such as Indonesia and Malaysia.
In a further attempt to limit the selling when Pavilion Reit starts trading, the deal was tightly allocated. About 200 institutional investors submitted orders, but 65% of the deal went to just 15 accounts. The cornerstone investors also bought some additional units through the bookbuilding, the source said. Aside from AIA’s Malaysian unit, the cornerstone investors include Employees Provident Fund Board, Great Eastern Life Assurance, HwangDBS Investment Management, Kumpulan Wang Persaraan and Permodalan Nasional, which are all high-quality domestic names.

Pavilion Reit, which is backed by Malaysian businessman Lim Siew Choon and his wife Tan Kewi Yong, as well as the Qatar Investment Authority (QIA), sold 790 million new units, or 26.3% of the trust. The units were marketed to institutional investors in a range between M$0.88 and M$0.90.

The IPO price of M$0.90 translates into a 2012 dividend yield of about 6.5%, according to the sources. That is roughly in line with where domestic competitors like Sunway Reit are trading. However, it is well below what telecom-focused HKT Trust is offering. The spin-off from PCCW priced its Hong Kong IPO at a 9% yield yesterday morning.
Aside from the steady yield, retail property-focused Pavilion Reit also emphasised its growth prospects through potential acquisitions and increases of rents and leasable areas at its existing properties. At the time of listing, the Reit will own a seven-storey shopping mall and a 20-storey office tower, which are both part of the Pavilion Kuala Lumpur project.

Southeast Asian stock markets, particularly the Philippines, Indonesia and Malaysia, have been outperforming their peers in Asia-Pacific this year, which likely helped shore up investor confidence in investing in the region. So far this year, the Philippine Stock Exchange Index is up almost 2%, while the Jakarta Composite Index is down 0.5% and the FTSE Bursa Malaysia KLCI Index is down about 6%. This compares with a decline of about 20% in both Hong Kong and Japan this year.

Pavilion Reit is the fourth-largest IPO in Malaysia this year after Bumi Armada, UOA Development and MSM Malaysia Holdings, according to Bloomberg data. Ananda Krishnan-backed Bumi Armada raised nearly $890 million in a popular IPO in July, while the other two raised about $350 million and $270 million, respectively, from their IPOs in June. Pavilion Reit will start trading on December 7.

CIMB, Credit Suisse, Maybank and QNB Capital are joint global coordinators for the offering. The first three are also joint bookrunners together with Deutsche Bank.

14 comments:

trusbx said...

hahaha your pics shouts a thousand sarcastic jokes

Loryau said...

OMG... non-stop laughing with the latest photo...

Arvin Sloane said...

SD, are you trying to please Aisha? please don't, she is just a drop of the ocean, don't waste time on her

Arvin Sloane said...

SD, please don't waste time with 'Aisha' he-she is probably a gay, whatever he-she is just a drop in the ocean, continue the great work of art.....

green said...

My milkshake brings all the boyz to the yard.
And also galz now.
If you wanna learn, I will have to charge. LOLZ

stocks2trade said...

I googled "Takeshi Kaneshiro" and it brings me here..LOL

DiN said...

WTH?! guy pic? are we taking 'detour' now? lol :p

DiN said...

WTH?! guy picture? are we taking different direction now? lol

k said...

fuck, why you give in to the pussy aisha lah??? screw "shim" man!!!

Simon said...

I start losing interest on your page

Sam said...

GOOD ONE! ROTFL!!

mr. lim said...

Glad to see picture of a hunk. This world is made up of 2 species, male and female. Glad that it is not confined to just 1 specie only.
Congrats Dali you have the balls to defy all odds and now you can have best of males and females readers.
I salute your courage.

emacro said...

Salvatore
What do you think of the price on opening? RM1.00?

emacro said...

RM1.03 opening and closed at RM1.02. Nice debut.2 sen above expectations...