Towards Financial Freedom
DBS Equity Research: Wired Daily 24 Mar 2015
Cambridge Industrial Trust - Acquisition of remaining 40% stake in property in Tuas. Maintain HOLD, TP S$0.73
Cambridge REIT (CREIT) announced the acquisition of the remaining 40% stake in a limited liability partnership (LLP) which owns 3 Tuas Avenue South 4 for a sum of S$11m. The vendor is Oxley, a related entity of the REIT's sponsor group. The property's long remaining lease of 23 years with built-in rental escalations offers a steady income stream and provides organic growth to the REIT. Initial yield is estimated to be c.5% which appears low but we believe is reflective of the site's development potential. We understand that current plot ratio of 0.49x is below the maximum allowable of c.1.0x, which implies an additional GFA of approximately 320,000 sq ft, which can be extracted from the site for future expansion to realise the full potential of the site. Maintain HOLD, TP S$0.73.
According to newswire, the Indonesian government plans to levy palm oil producers US$50/MT on CPO exports and US$30/MT on Olein exports for so-called "CPO Supporting Fund"; while maintaining the minimum export reference prices to calculate export taxes. The Fund will be used to support the government's biodiesel programme (i.e. subsidies). An Indonesian Palm Oil Farmers Association (APKASINDO) spokesman was quoted as saying that the levy would be detrimental to farmers, as it would cause FFB prices to drop 20% to c.Rp800-Rp900/kg from current price of Rp1,100-Rp1,400/kg. The proposed levy is equivalent to 8.3% export tax at current prices, and will progressively increase towards 26.5% at CPO prices above US$1,250/MT. Our earnings forecasts are to be reviewed for downside bias if the new policy is implemented.
Genting Singapore has executed a facility agreement for syndicated senior secured credit facilities of S$2.27bn. The New Facilities will be utilized primarily for refinancing RWS's existing facilities of S$4.1925bn obtained in 2011.
Rex International Holding announce that its jointlycontrolled entity, Lime Petroleum Norway, has secured an increase of its financing facility from Skandinaviska Enskilda Banken AB from NOK 300 million to NOK 700 million (approximately US$87.5m), to fund its participation in its offshore exploration drilling programme in 2015. The facility was first secured in December 2013.
Roxy-Pacific Holdings announced a second joint venture with Australia-based superannuation fund, Hostplus, to acquire a 4.4-hectare land parcel in North Fremantle, Perth, Australia, for A$59 m (~S$63m), as part of its geographical diversification strategy. The joint venture partners intends to rezone the industrial site - located next to the prime Leighton beach and a train station connected directly to Perth's central business district - for residential and commercial uses.
Source: DBS
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