Singapore Exchange (SGX) Mainboard-listed Keppel DC REIT (KDCR) is proposing to acquire two local data centres for S$585.10 ($425.68 million).
The REIT is concurrently also launching a combination of a private placement, preferential offering, and debt to fund the purchase.
Keppel DC Singapore 4, one of the proposed data centres to be acquired by KDCR, was priced at S$384.90 million ($280.05 million) for a 99 per cent stake. The seller is Thorium DC Pte Ltd. The remaining one per cent stake was acquired by an entity of Keppel Data Centres Holding Pte Ltd.
The second proposed data centre, 1-Net North Data Centre, was acquired by KDCR for S$200.20 million ($145.67 million). The sellers are CityDC Pte Ltd, and WDC Development Pte Ltd.
The proposed acquisitions are expected to be completed in the fourth quarter of 2019 (4Q 2019), and are distribution per unit (DPU) accretive. The pro forma DPU is expected to increase by 9.43 per cent.
Assets under management (AUM) is also expected to increase from S$1.98 billion ($1.44 billion) to S$2.58 billion ($1.88 billion) following the completion of both the deals.
KDCR is launching a fully-funded equity fundraising exercise of approximately S$473.80 million ($344.74 million) comprising a private placement and preferential offering, as well as debt.
The equity fundraising exercise is expected to reduce KDCR’s aggregate leverage ratio from 31.90 per cent as on June 30, 2019 to 30.30 per cent, increasing the REIT’s debt headroom to pursue further opportunities.