Esr-REIT · SGX:9A4U
Esr-REIT — Merger or Acquisition (July 2020)
30 slides from Esr-REIT's merger presentation, Jul 16, 2020
Slide 1: Proposed Merger with Sabana REIT
Proposed Merger with Sabana REIT (the “Merger”) 16 July 2020
Slide 2: Important Notice
Important Notice This presentation shall be read in conjunction with ESR-REIT’s results announcements for the half year ended 30 June 2020. Important Notice The value of units in ESR-REIT ("Units") and the income derived from them may fall as well as rise. Units are not investments or deposits in, o
Slide 3: Transaction Overview
Transaction Overview 3 Tuas South Avenue 4 | General Industrial
Slide 4: Key Benefits of the Merger
Key Benefits of the Merger Greater Scale, Deeper Presence 1 DPU and NAV Accretive to ESR-REIT Unitholders 2 Enhances Diversification and Resilience of the Enlarged REIT Platform 100% Pure-Play Singapore REIT with Operational Synergies, Organic 3 Portfolio Growth and Optimisation Potential Size Does
Slide 5: Scheme Consideration
Scheme Consideration The Scheme Consideration payable to the Sabana Unitholders, which will be satisfied in full by way of issuance of new ESR-REIT Units, is based on a gross exchange ratio of 0.940x 1.000 0.940 Sabana Unit New ESR-REIT Units(1) For illustrative purposes: Assuming an issue price of
Slide 6: Enlarged REIT Structure Post Merger
Sabana REIT will become a wholly-owned sub-trust of ESR-REIT Enlarged 100% Pure-Play Singapore REIT REIT Manager Structure Enlarged REIT Structure Post Merger(1) ESR Cayman Enlarged REIT Alignment of interests between Sponsor, ESR-REIT Manager and Mr. Tong Minority Limited unitholders Unitholders
Slide 7: Key Benefits of the Merger
Key Benefits of the Merger UE BizHub EAST | Business Park
Slide 8: Value Accretive for ESR-REIT Unitholders
1 Value Accretive for ESR-REIT Unitholders The Merger is expected to be DPU and NAV per unit accretive to ESR-REIT Unitholders on a pro forma basis FOR ILLUSTRATIVE PURPOSES ONLY – NOT A FORWARD LOOKING PROJECTION Distribution per Unit (Singapore Cents)(1) NAV per Unit (Singapore Cents) Accretion Ac
Slide 9: Increased Exposure to High-Specs and Logistics Segments
Enhances Diversification and Resilience of the Enlarged REIT Platform: 2 Increased Exposure to High-Specs and Logistics Segments Enhanced diversification of assets across 4 segments with more than half of the Enlarged REIT’s portfolio consisting “future-ready” High-Specs properties and resilient Log
Slide 10: Addition of New Tenants Reduce Concentration Risk
Enhances Diversification and Resilience of the Enlarged REIT Platform: 2 Addition of New Tenants Reduce Concentration Risk Increased diversification across number and types of tenants improves the stickiness of the Enlarged REIT’s overall tenant base with top 10 tenants accounting for 25% of the Enl
Slide 11: Deepens Singapore Presence in Key Industrial Clusters
100% Pure-Play Singapore REIT Post-Merger: 3 Deepens Singapore Presence in Key Industrial Clusters Sabana REIT assets are strategically located in key industrial classes across Singapore, enhancing ESR-REIT’s current island-wide portfolio network The Enlarged REIT will have a portfolio of 75 propert
Slide 12: Operational Synergies and Portfolio Optimisation Potential
100% Pure-Play Singapore REIT Post-Merger: 3 Operational Synergies and Portfolio Optimisation Potential Increased size and scale will bring about opportunities for operational synergies and portfolio optimisation potential No. of Properties(1) Estimated Total GFA (m sq ft)(1)(2) No. of Tenants(1) 57
Slide 13: Organic AEI Growth Opportunities to Realise Unutilised GFA
100% Pure-Play Singapore REIT Post-Merger: 3 Organic AEI Growth Opportunities to Realise Unutilised GFA Enhances potential returns and lowers risks of value-adding AEIs and/or redevelopments Exposure to larger tenant base helps identify optimal use for unutilised GFA and reduce leasing risks Acc
Slide 14: Lease-Up Opportunities For Organic Growth
100% Pure-Play Singapore REIT Post-Merger: 3 Lease–Up Opportunities For Organic Growth Being part of the Enlarged REIT provides the ability to leverage ESR-REIT and ESR Group’s platform to enhance leasing opportunities Occupancy Rates by Key Clusters(1)(2) Overall Portfolio Occupancy(1) 93% 91% 80%
Slide 15: Solidifies Position amongst Top Industrial S-REITs
Size Does Matter: 4 Solidifies Position amongst Top 5 Industrial S-REITs The Enlarged REIT is expected to solidify its position amongst the top 5 industrial S-REITs, backed by a strong developer-sponsor, with a combined asset size of c.S$4.1bn Total Asset Size (S$bn)(1) Singapore (3) Industrial GFA
Slide 16: Larger Size Leads to More Competitive Costs of Capital
Size Does Matter: 4 Larger Size Leads to More Competitive Costs of Capital The Enlarged REIT is expected to have a lower cost of debt, longer WADE(1) and access to wider pools of capital while retaining balance sheet flexibility with a fully unencumbered portfolio FOR ILLUSTRATIVE PURPOSES ONLY – NO
Slide 17: Potential Inclusion in Key Indices
Size Does Matter: 4 Potential Inclusion in Key Indices Increased probability of inclusion in key indices, which offers benefits of a wider and more diversified investor base, higher trading liquidity, increased analyst coverage and potential positive re-rating Free Float and Market Capitalisation (S
Slide 18: Leveraging ESR Group's Operating Platform to Improve Growth Prospects
Leveraging ESR Group’s Operating Platform to 5 Improve Growth Prospects Enlarged REIT can better leverage ESR Group’s operating platform, footprint and network to create a leading Pan-Asian industrial REIT ESR Group’s Operating Platform and Capabilities ESR Group’s Regional Presence Largest APAC Lar
Slide 19: Approvals Required
Approvals Required 48 Pandan Road | Logistics / Warehouse
Slide 20: Approvals Required for ESR-REIT
Approvals Required for ESR-REIT Approvals Required Requirements More than 50% of the total number of votes cast(1) Merger (Ordinary Resolution) ESR Cayman Limited, Mr. Tong, Mitsui and their respective associates are required to abstain from voting Issuance of ESR-REIT More than 50% of the tot
Slide 21: Approvals Required for Sabana REIT
Approvals Required for Sabana REIT Approvals Required Requirements Amendment of the Sabana REIT Trust Deed Not less than 75% of total number of votes cast(1) (“Trust Deed Amendments Resolution “) More than 50% in number representing not less than 75% in value of Sabana Unitholders(1) ESR-REIT
Slide 22: Indicative Timeline
Indicative Timeline 3 Tuas South Avenue 4 | General Industrial
Slide 23: Expected Indicative Timeline
Expected Indicative Timeline 1 2 4 6 September 2020 October 2020 October / November November 2020 Expected date of first 2020 ESR-REIT EGM Expected delisting of Court hearing of the Expected Effective Sabana REIT from application to convene (AM time) Date of Scheme(2) SGX the Scheme Meeting(1) 2 3 5
Slide 24: Summary of Key Takeaways for the Merger
Summary of Key Takeaways for the Merger Greater Scale, Deeper Presence 1 DPU and NAV Accretive to ESR-REIT Unitholders 2 Enhances Diversification and Resilience of the Enlarged REIT Platform 100% Pure-Play Singapore REIT with Operational Synergies, Organic 3 Portfolio Growth and Optimisation Potenti
Slide 25: Appendix
Appendix UE BizHub EAST | Business Park
Slide 26: Financing Considerations
Financing Considerations FOR ILLUSTRATIVE PURPOSES ONLY Illustrative Uses Approximately S$777.4m comprising: − Implied Scheme Consideration of approximately S$396.9m Total − Refinancing of Sabana REIT’s total borrowings and related interest rate swaps of approximately Acquisition S$295.0m and upfr
Slide 27: Sabana REIT – Portfolio Overview
Sabana REIT – Portfolio Overview Valuation (S$m): 323.4 Valuation (S$m): 54.0 Valuation (S$m): 22.0 Occupancy Rate (%): 71 Occupancy Rate (%): 86 Occupancy Rate (%): 92 GFA (sq ft): 832,373 GFA (sq ft): 161,815 GFA (sq ft): 73,928 Land Lease Expiry (Year): 2055 Land Lease Expiry (Year): 2059 Land Le
Slide 28: Sabana REIT – Portfolio Overview (Cont'd)
Sabana REIT – Portfolio Overview (Cont’d) Valuation (S$m): 35.6 Valuation (S$m): 24.7 Valuation (S$m): 34.7 Occupancy Rate (%): 100 Occupancy Rate (%): 100 Occupancy Rate (%): 56 GFA (sq ft): 246,376 GFA (sq ft): 149,166 GFA (sq ft): 217,899 Land Lease Expiry (Year): 2054 Land Lease Expiry (Year): 2
Slide 29: Investor and Media Contacts
Investor and Media Contacts Primary Investor Contact Citigroup Global Markets Singapore Pte. Ltd. Investment Banking Telephone: +65 6657 1959 Media Contact Newgate Communications Terence Foo / Bob Ong / Elizabeth Yeong Email: terence.foo@newgatecomms.com.sg / bob.ong@newgatecomms.com.sg / elizabeth.
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