Mapletree Commercial Trust Merger

Mapletree Commercial Trust Preferential Offering

MCT and MNACT Merger

Existing investors of Mapletree Commercial Trust would have received the application form on Mapletree Commercial Trust Preferential Offering.

The purpose is to raise gross proceeds of approximately S$2,040.7 million because the cash component payable by Mapletree Commercial Trust for the Scheme Consideration as a result of the merger is approximately S$2,454.5 million in aggregate

A Preferential Offering of 1,018,382,531 new units of Mapletree Commercial Trust (“MCT”) will be issued at an issue price of S$2.0039 per new unit, on a pro rata basis of 306 new units for every 1,000 existing units in MCT held by the eligible unitholders.

I think the big question in every existing investors of Mapletree Commercial Trust is whether they should apply for the new units at the offer price of S$2.0039?

Should You Apply For the Preferential Offering?

Based on the recent share price of Mapletree Commercial Trust, it certainly does not make sense. As of 15 July 2022, Mapletree Commercial Trust is trading at S$1.78 per unit on the stock market.

What will happen if investors does not apply for the Preferential Offering?

Mapletree Investments who is the sponsor of both Mapletree North Asia Commercial Trust (“MNACT”) and Mapletree Commercial Trust (“MCT”) has committed to take up the maximum units of the preferential offering.

Dividend Yield

Based on the Pro forma DPU of 10.18 cents and offer price of S$2.0039, this translate to a dividend yield of 5.08%.

Based on the closing price of S$1.78, this translate to dividend yield of 5.72%.

My Decision

As an existing investor of MCT, I will not be taking up the preferential offering as it totally does not make sense. In my opinion, the price of S$2.0039 is premium. You are better off buying MCT off the stock market.

The offer price should take consideration of the current stock price of S$1.78 to make this preferential offering more attractive. Otherwise, it is simply a waste of everyone’s time.

Nevertheless if you want to apply, here are some key dates.

Units trade ex-Preferential Offering Tuesday, 5 July 2022
Record Date for the Preferential Offering 5.00pm on Wednesday, 6 July 2022
Opening date and time for the Preferential Offering 9.00am on Tuesday, 12 July 2022
Last date and time for acceptance, application (if applicable) and payment for provisional allotments of New Units and Excess New Units (the “Closing Date”) 5.30pm on Wednesday, 20 July 2022
Expected date for crediting of New Units Thursday, 28 July 2022
Expected date and time for commencement of trading of New Units 9am on Thursday, 28 July 2022
Expected date for refund of unsuccessful applications (if made through CDP) Thursday, 28 July 2022

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