JAKARTA (TheInsiderStories) – Lippo Malls Indonesia Retail Trust (LMIRT) looking for funding around of S$280 million (US$205.88 million) through a rights issue program to acquires Lippo Mall Puri from PT Mandiri Cipta Gemilang (MCG), said the company today. The investment manager its the subsidiary of PT Lippo Karawaci Tbk (IDX: LPKR).
The company will list about 4.68 billion units or 160 percent of the 2.92 billion units available through the rights issue scheme. Its means, every 100 LMIRT units can order an additional 160 units at price of S$0.060. The rights price was around 47.8 percent of the closing price of S$0.115 a unit at Singapore Stock Exchange on Sept. 17.
“As stated in the Announcement update on August 31, 2020, we intend to finance the acquisition of (Lippo Mall Puri) through the issuance of a new unit at LMIRT and through a combination of debt financing of up to S$120 million,” wrote the management on Monday (09/21).
The parent, was in the process of selling its ownership at Lippo Mall Puri to its affiliated party, Puri Bintang Terang, a unit whose entire shares are indirectly owned by Lippo Malls. The developer will raises Rp3.50 trillion ($239.73 million) from this transaction.
The funds obtained by Lippo Malls will then be given to another subsidiary of the parent, Binjaimall Holdings Pte. Ltd., which will be deposited with Puri Bintang Terang to pay the sale and purchase price to the seller, MCG, which is also a subsidiary of the issuer.
“Mandiri Cipta Gemilang will also provide vendor financing to Binjaimall Holding of S$40 million,” said the statement.
The company also stated, that after the acquisition process is completed, Lippo Mall Puri will become the company’ main asset because the prospect of high occupancy rates will attract new tenants. The management also added that rental income recovery is likely to begin at the end of 2021.
Earlier, CEO of Lippo Karawaci, John Riady, said that the divestment of assets to affiliates was one of the company’ steps to recycling its assets and generate new capital to support the company’ expansion. While, REITS managed by the Lippo Group and listed on SGX-ST since 19 November 2007.
US$1: S$1.36, Rp14,600
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