SingHaiyi Group, Chip Eng Seng Corporation and KSH Holdings, on Dec 3, announced that they have successfully made an offer for the enbloc acquisition of Peace Centre and Peace Mansion.
The offer price of $650.0 million was made on Dec 2 by way of a private treaty, and was accepted on Dec 3.
See: Peace Centre and Peace Mansion launch collective sale tender, owners expect offers of more than $650 mil
The joint offer was made through Sing-Haiyi Crystal, CEL Development and Ultra Infinity.
Sing-Haiyi Crystal is a 50-50 joint venture (JV) between SingHaiyi Realty, SingHaiyi’s wholly-owned subsidiary and Haiyi Properties.
CEL Development is a wholly-owned subsidiary of Chip Eng Seng Corporation.
Ultra Infinity is a 33.3%-owned associated company of KSH Holdings. The other shareholders in Ultra Infinity are SLB Development and Ho Lee Group holding respective stakes of 33.33% each.
Peace Centre and Peace Mansion are two properties that sit on a single commercial site at 1 Sophia Road.
The property as a whole comprises 319 strata units.
See also: Frasers Property: Narrowing the discount
Peace Centre and Peace Mansion has a total land area of 7,118 sqm and have a 99-year leasehold tenure beginning from June 2, 1970.
The joint offerors will seek in-principle approval from the Singapore Land Authority (SLA) to issue a fresh 99-year lease. They will also seek approval from the Urban Redevelopment Authority (URA) to redevelop the property into a mixed-use commercial and residential development.
The commercial component will be 60% of the total gross floor area (GFA), while the residential component will comprise 40% of the total GFA.
The property launched a collective sale tender on Sept 6. According to a press release by JLL at the time, the owners said they were expecting offers of more than $650 million for the entire commercial site.
Proposed JV
On the same day, the joint offerors stated that they will form a JV and enter into a joint venture agreement (JVA) to set out the terms relating to their joint acquisition.
They have already entered into a binding memorandum of understanding (MOU).
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Under the JV, CEL will hold a 40% stake, while Sing-Haiyi Crystal and Ultra Infinity will each hold 30% stakes.
The joint offerors will pay for the purchase price as well as other costs in their respectively participation proportions.
Interested person transaction
Gordon Tang and his wife Celine Tang are the owners of SingHaiyi; as at Dec 3, the couple jointly hold an 82% stake in the group. The Tangs are also the controlling shareholders of Haiyi Properties, which has a 50% stake in the JV Sing-Haiyi Crystal. Furthermore, the couple are the joint controlling shareholders of CEL.
See also: Tangs offer to privatise SingHaiyi Group at 11.7 cents per share
Celine Tang is also the non-independent and non-executive director, and non-executive chairman of CES.
Accordingly, the investment from Sing-Haiyi Crystal and CEL into the project constitutes as an interested person transaction.
Shares in SingHaiyi, Chip Eng Seng and KSH Holdings closed 11.7 cents, 41 cents and 35 cents respectively on Dec 2.
