SINGAPORE (Mar 26): Keppel Corporation is jointly acquiring Yi Fang Tower in Shanghai for a consideration of RMB 4.6 billion ($926 million).
The Yi Fang Tower is a recently completed prime Grade A office and retail mixed-use development located in North Bund. It is made up of two 18-storey office towers and a retail podium, with a total gross lettable area of about 74,400 sqm.
Eric Goh, CEO (China) of Keppel Capital, says, “The proposed acquisition is in line with Keppel Capital’s investment strategy of creating value and driving returns for our investors. Yi Fang Tower is a quality asset that is well-connected to Shanghai’s core central business districts and is expected to meet growing demand from quality tenants in the professional services and financial sectors. This partnership with the co-investors is also testament to the confidence that they have in Keppel Capital in delivering good returns.”
The sale was made through JV company North Bund Keppel which comprises the wholly-owned subsidiaries of Keppel's Alpha Asia Macro Trends Fund III (AAMTF III) -- a fund managed by Alpha Investment Partners Limited, the private fund management arm of Keppel Capital Holdings -- and Keppel Land China Limited (KLCL), together with other co-investors.
The JV company is currently held by a wholly-owned subsidiary of AAMTF III. Under the agreement, after the initial round of funding through subscription of shares in the JV company, it will have a paid-up capital of approximately US$302 million, and AAMTF III and KLCL will have a shareholding interest of about 42.1% and 29.8% respectively. The remaining 28.1% shareholding interest will be held by the other co-investors.
This acquisition is expected to take place in 2Q19.
Shares in Keppel Corp last traded at $6.17 on Monday.
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