Frasers Property Ltd. · SGX:TQ5
Frasers Property — Frasers Hospitality Trust — Merger or Acquisition (August 2022)
39 slides from Frasers Property's merger presentation, Aug 19, 2022
Slide 1: Frasers Hospitality Trust: Proposed privatisation by Frasers Property Limited
Frasers Hospitality Trust Proposed privatisation by a wholly-owned subsidiary of Frasers Property Limited 19 August 2022 Intercontinental Singapore
Slide 2: Important Notice
Important Notice NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT JURISDICTION. THIS PRESENTATION SHALL NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY SE
Slide 3: Contents
Contents Transaction Summary Background to the Scheme Transaction Rationale Financial Evaluation of the Scheme IFA Opinion and Directors’ Recommendations Timeline and Approvals Required Additional Information – Voting Instructions InterContinental Singapore 3
Slide 4: Transaction Summary
Transaction Summary Fraser Suites Sydney
Slide 5: Transaction overview
Transaction overview Frasers Property Hospitality Trust Holdings Pte. Ltd. Offeror • Wholly-owned subsidiary of Frasers Property Limited Proposed privatisation of FHT, to be effected through: Transaction • The proposed acquisition by the Offeror of all the Stapled Securities of FHT held by the S
Slide 6: Background to the Scheme
Background to the Scheme Fraser Suites Queens Gate London
Slide 7: The Scheme to privatise FHT is the outcome of a robust strategic review (1/2)
The Scheme to privatise FHT is the outcome of a robust strategic review conducted by the FHT Independent Directors (1/2) Since FHT’s announcement referring to strategic options made on 8 April 2022, the FHT Independent Directors had, with the assistance of their financial adviser DBS Bank Ltd., expl
Slide 8: The Scheme to privatise FHT is the outcome of a robust strategic review (2/2)
The Scheme to privatise FHT is the outcome of a robust strategic review conducted by the FHT Independent Directors (2/2) Credible option for Stapled Securityholders to realise their Further background on the strategic review announced on 8 April 2022 investments with a high degree of certainty at an
Slide 9: Transaction Rationale
Transaction Rationale Novotel Sydney Darling Square
Slide 10: FHT has encountered long-term challenges and obstacles which are limiting growth
FHT has encountered long-term challenges and obstacles which are limiting growth 1 Obstacles in growing distribution per Stapled Security (“DPS”) and net asset value (“NAV”) • Muted growth in FHT’s key hospitality markets since IPO despite: (a) FHT’s proactive pursuit of yield-accretive acquisitions
Slide 11: Since its IPO, FHT has proactively pursued organic and inorganic strategies to grow
Since its IPO, FHT has proactively pursued organic and inorganic strategies to grow Strategic acquisitions, refurbishments and AEI have resulted in portfolio growth, but have had limited impact on DPS and NAV growth i. Since its IPO, the FHT Managers have ii. Significant efforts have been made to gr
Slide 12: FHT's operating markets experienced muted growth
FHT’s operating markets experienced muted growth The hospitality sector in FHT’s key operational markets has seen minimal growth since FHT’s IPO in 20141 Pre-COVID-192 Pre-COVID-192 Pre-COVID-192 Singapore RevPAR CAGR: London RevPAR CAGR: Sydney RevPAR CAGR: -0.9% 2.2% 0.3% 500 100% 200 100% 250 100
Slide 13: A strengthening S$ has offset local currency revaluation gains
A strengthening S$ has offset local currency revaluation gains Concerted efforts were made by FHT to grow since IPO. However, significant headwinds from adverse FX trends have offset gains made over the years by FHT’s portfolio in local currency terms Operational currencies have weakened against S$
Slide 14: Timing and speed of a full recovery from the impact of COVID-19 remain uncertain
Timing and speed of a full recovery from the impact of COVID-19 remain uncertain While the COVID-19 pandemic has gradually moved toward an endemic phase and many countries globally have reopened borders, it remains uncertain whether the operating and financial performance of FHT’s properties would r
Slide 15: Geopolitical tensions and looming recessionary pressures add further uncertainty
Geopolitical tensions and looming recessionary pressures add further uncertainty to the recovery outlook Ongoing Russia-Ukraine conflict compounded existing inflationary pressures, in turn triggering interest rate hikes and leading to higher costs of capital Inflationary pressures have driven up Con
Slide 16: Further strengthening of S$ could limit revaluation gains and DPS growth
Further strengthening of S$ could potentially limit any potential revaluation gains and DPS growth from a COVID-19 recovery Further strengthening of S$ could potentially limit any potential NAV and DPS growth from a COVID-19 recovery S$ likely to remain strong vs. FHT’s operational currencies1 (%) 4
Slide 17: Size matters and is essential in enabling liquidity and growth
Size matters and is essential in enabling liquidity and growth FHT’s small size has limited its ability to reap the benefits of a continued listing • FHT is the 2nd smallest hospitality trust on the SGX-ST in terms of asset size and market capitalisation with some of its other listed peers being app
Slide 18: Financial Evaluation of the Scheme
Financial Evaluation of the Scheme Fraser Suites Edinburgh
Slide 19: Financial Evaluation of the Scheme Consideration
Financial Evaluation of the Scheme Consideration 1 P/NAV as implied by the Scheme Consideration of 1.07x exceeds historical averages of FHT’s trading multiples since IPO, current trading multiples of other listed Singapore hospitality trusts and precedent S-REIT privatisations 2 Premia of 45.4%, 48.
Slide 20: The FHT Managers have commissioned valuations of FHT's properties as at 31 May 2022
The FHT Managers have commissioned valuations of FHT’s properties as at 31 May 2022 Latest Adjusted NAV per Stapled Security against the Scheme Consideration (S$) 0.7000 0.6534 (0.0096) 0.0027 (0.0070) 0.0124 0.6519 The latest independent valuations have accounted for the potential recovery trajecto
Slide 21: P/NAV multiple implied by Scheme Consideration allows exit at an attractive valuation
P/NAV multiple implied by Scheme Consideration allows Stapled Securityholders to exit at an attractive valuation P/NAV as implied by the Scheme Consideration1 against benchmarks 1.07x 0.73x 0.75x 0.81x 0.86x 1.04x 0.90x 2 2 2 2 3 4 P/NAV as implied by the 1-Year Average 3-Year Average 5-Year Average
Slide 22: Scheme Consideration represents premia to 1-, 3-, 6- and 12-month VWAP
Scheme Consideration represents a premium of 45.4%, 48.5%, 47.7% and 43.8% to the 1-month, 3-month, 6-month and 12-month VWAP respectively1,2 Scheme Consideration: S$0.700 per Stapled Security 22.8% 45.4% 48.5% 47.7% 43.8% S$0.570 S$0.482 S$0.471 S$0.474 S$0.487 Last Transacted Price 3 1-month VWAP
Slide 23: Premia exceed average premia in precedent S-REIT privatisations
Premia over benchmark prices exceed average premia paid in precedent S-REIT privatisations over most corresponding benchmark periods1,3 Premia over Benchmark Prices (%) 23% 28% 45% 32% 49% 34% 48% 38% 44% 33% 2 Last Transacted Price 1-month VWAP 3-month VWAP 6-month VWAP 12-month VWAP FHT Average of
Slide 24: Provides a higher total return than two out of three of FHT's peers
Provides a higher total return for Stapled Securityholders1 than two out of three of FHT’s peers2 over the same period Total Returns Analysis Since IPO Total returns analysis for Stapled Securityholders Average entry cost of a Stapled Securityholder who Sum of Scheme Distributions since invested at
Slide 25: Scheme Consideration represents a premium of 16.7% to analyst consensus target price
Scheme Consideration represents a premium of 16.7% to analyst consensus target price1 in 2022 Average consensus target price: S$0.600 per Stapled Security In arriving at the target prices, the respective analyst reports have S$0.700 S$0.550 S$0.650 taken into account the recovery prospects of FHT. S
Slide 26: Scheme Consideration takes into account pre-COVID-19 portfolio valuations
Scheme Consideration takes into account pre-COVID-19 portfolio valuations In line with adjusted NAV per Stapled Security assuming Pre-COVID-19 portfolio valuations (S$) 0.0027 (0.0070) 0.0124 0.7029 0.7000 0.0415 0.6534 Demonstrates that recovery prospects have been taken into account in arriving at
Slide 27: IFA Opinion and Directors' Recommendations
IFA Opinion and Directors’ Recommendations InterContinental Singapore
Slide 28: Recommendation of the FHT Directors on the FHT Trust Deeds Amendments
Recommendation of the FHT Directors on the FHT Trust Deeds Amendments Recommendation of the FHT Directors on the FHT Trust Deeds Amendments “ Having regard to the above and the rationale for the FHT Trust Deeds Amendments as set out in Paragraph 7 of the Letter to Stapled Securityholders, the FHT Di
Slide 29: Opinion of the FHT IFA and Recommendation of the FHT Independent Directors
Opinion of the FHT IFA and Recommendation of the FHT Independent Directors on the Scheme Opinion of the FHT IFA on the Scheme “ Based on our analysis and after having considered carefully the information available to us as at the Latest Practicable Date, we are of the opinion that the financial term
Slide 30: Timeline and Approvals Required
Timeline and Approvals Required ibis Styles London Gloucester Road
Slide 31: The Scheme will be subject to the approval of the Stapled Securityholders and other conditions
The Scheme will be subject to the approval of the Stapled Securityholders and various other conditions a. FHT EGM b. Scheme Meeting The FHT Managers will first seek the approval of Stapled Securityholders for the FHT Trust Subject to the FHT Scheme Amendments being approved by Stapled Securityholder
Slide 32: Indicative Timeline
Indicative Timeline Key Event Expected Date and Times (Singapore Time) Last Date and Time for Pre-registration for SIAS-FHT Dialogue Session1 Wednesday, 24 August 2022 at 12.00 p.m. SIAS – FHT Dialogue Session Grand Ballroom III, Level 2, InterContinental Singapore, 80 Middle Road, Singapore 188966
Slide 33: Additional Information - Voting Instructions
Additional Information - Voting Instructions Fraser Place Canary Wharf London
Slide 34: How do I vote if I am unable to attend in person?
How do I vote for the FHT EGM and the Scheme if I am unable to attend the FHT EGM and/or Scheme Meeting in person? Information on Obtaining the Proxy Forms Information on Completing and Submitting the Proxy Forms The FHT EGM and the Scheme Meeting are two different meetings of Stapled Fill in BOTH
Slide 35: How do I vote on the FHT Trust Deeds Amendments Resolution?
How do I vote on the FHT Trust Deeds Amendments Resolution? Receive Notice of FHT EGM and Proxy Form A (FHT EGM) ATTEND THE FHT EGM IN VOTE BY PROXY PERSON TO CAST YOUR VOTE Details of the FHT EGM: If you are unable to attend the FHT EGM in 12 September 2022 at 10.00 a.m. person, appoint a proxy
Slide 36: How do I vote on the Scheme Resolution?
How do I vote on the Scheme Resolution? Receive Notice of Scheme Meeting and Proxy Form B (Scheme Meeting) ATTEND THE SCHEME MEETING VOTE BY PROXY IN PERSON TO CAST YOUR VOTE Details of the Scheme Meeting: If you are unable to attend the Scheme Meeting in 12 September 2022 at 10.30 a.m. person,
Slide 37: Investor Contacts
Investor Contacts Investor Contact Lead Financial Adviser to the FHT Managers Financial Adviser to the FHT Managers DBS Bank Ltd. Maybank Securities Pte. Ltd. Strategic Advisory Investment Banking and Advisory Telephone: +65 6878 3913 Telephone: +65 6231 5183 Media Contact FHT Investor Relations PR
Slide 38: Responsibility Statement
Responsibility Statement The directors of the FHT Managers (including those who may have delegated detailed supervision of this presentation) have taken all reasonable care to ensure that the facts stated and opinions expressed in this presentation (other than any information relating to or opinions
Slide 39: Thank You
Z FRASERS GT HOSPITALITY TRUST Thank You
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