SGX-listed Frasers Property Limited is acquiring a 17.8 per cent stake in PGIM Real Estate Asia Retail Fund Limited (PGIM Real Estate) for about S$356.4 million ($262.7 million), according to a stock market disclosure.
The acquisition will be carried out by Frasers’ wholly owned subsidiary, Frasers Property Crystal.
PGIM Real Estate is the largest non-listed retail mall fund in Singapore. It owns and manages six retail malls in close proximity to MRT subway stations (Tiong Bahru Plaza, White Sands, Liang Court, Hougang Mall, Century Square and Tampines 1) and an office property (Central Plaza) in Singapore, and four retail malls in Malaysia.
It is also the real estate investment business of PGIM, the $1-trillion global investment management business of Prudential Financial, Inc.
Frasers Property said the acquisition, which will be financed via internal funds, external borrowings or a combination, is conditional upon consent from the Bermuda Monetary Authority, and board approval from PGIM Real Estate.
As at Dec 31, the book value and net asset value of the sale shares amount to S$355.5 million ($262 million), which includes the fourth quarter 2018 dividend.
The group added that the deal is in line with its strategy to grow recurring income sources in one of its key asset classes. The assets in PGIM Real Estate, it added, are primarily suburban retail properties in Singapore, an asset class in which Frasers Property has “significant experience”.
“The acquisition offers an opportunity for the Group to grow its presence in the retail sector in Singapore through exposure to the PGIM Real Estate’s portfolio of quality retail properties,” Frasers Property said.
The stake acquisition adds to the number of deals that Frasers Property Limited has carried since last year. In July, the company announced that it will buy a 75 per cent stake in Ho Chi Minh City-based Phu An Dien Real Estate Joint Stock Company (PAD) for VND799 billion ($34.3 million)
Earlier in 2018, Frasers Property also announced its acquisition of a property portfolio of 22 assets owned and managed by Alpha Industrial Holding in Luxembourg. The deal also covered the acquisition of the project and asset management business of Alpha Industrial through the purchase of the entire issued share capital of Alpha Industrial GmbH & Co in Cologne, Germany.