OF THE SECURITIES REGULATION CODE
AND SRC RULE 17.2(c) THEREUNDER 1. Date of Report (Date of earliest event reported) Apr 1, 20222. SEC Identification Number CS2020522943. BIR Tax Identification No. 502-228-971-0004. Exact name of issuer as specified in its charter MREIT, Inc.5. Province, country or other jurisdiction of incorporation Philippines6. Industry Classification Code(SEC Use Only) 7. Address of principal office 18th Floor, Alliance Global Tower, 36th Street corner 11th Avenue, Uptown Bonifacio, Taguig City, PhilippinesPostal Code16348. Issuer's telephone number, including area code (632) 8894-6300/64009. Former name or former address, if changed since last report N/A10. Securities registered pursuant to Sections 8 and 12 of the SRC or Sections 4 and 8 of the RSA
| Title of Each Class | Number of Shares of Common Stock Outstanding and Amount of Debt Outstanding |
| Common Shares | 2,532,121,381 |
The Exchange does not warrant and holds no responsibility for the veracity of the facts and representations contained in all corporate disclosures, including financial reports. All data contained herein are prepared and submitted by the disclosing party to the Exchange, and are disseminated solely for purposes of information. Any questions on the data contained herein should be addressed directly to the Corporate Information Officer of the disclosing party.
MREIT, Inc.MREIT PSE Disclosure Form REIT-4 - Acquisition or Disposition of AssetsReferences: Rule 5 of the IRR of the REIT Act of 2009 and
Section 6 of the Amended PSE Listing Rules for REITS
| Subject of the Disclosure |
Board approval of Megaworld Corporation's subscription to 263,700,000 common shares, with a par value of One Peso (PhP1.00) per share, resulting in Additional Paid-In Capital of Php5,010,300,000.00, or a total subscription price of Php5,274,000,000.00, in exchange of four (4) Grade A buildings located in PEZA-registered Zones under a tax-free property-for-share swap transaction |
| Background/Description of the Disclosure |
At the special meeting of the Board of Directors of MREIT, Inc. ("MREIT") held on April 1, 2022, the Board of Directors approved the proposed subscription by Megaworld Corporation ("Megaworld") to Two Hundred Sixty Three Million Seven Hundred Thousand (263,700,000) common shares in MREIT, for a total subscription price of Philippine Pesos: Five Billion Two Hundred Seventy Four Million (Php5,274,000,000.00), to be paid for by way of transfer of four (4) Grade A buildings located in PEZA-registered Zones, namely: 100% ownership of Two Global Center and of Festive Walk 1B, which are located in Iloilo Business Park, and 80% pro indiviso ownership of One West Campus and of Five West Campus, which are located in McKinley Hill in Fort Bonifacio, Taguig. |
| Date of Approval by Board of Directors | Apr 1, 2022 |
| Date | TBA |
| Description of the Assets Involved |
The assets are prime office properties located in PEZA-registered zones with a combined Gross Leasable Area ("GLA") of 44,567 square meters. |
| Type (land, building, etc.) | Location | Size | Rights Acquired (Ownership/ Leasehold etc.) |
| Building | Two Global Center, Megaworld Blvd. and Enterprise Rd., Iloilo Business Park, Manduriao Iloilo City | 13,202.71 | 100% ownership |
| Building | Festive Walk 1B, Lot 5 Buhang Taft North Mandurriao, Iloilo City | 19,416.75 | 100% ownership |
| Building | One West Campus, 5 Le Grand Avenue, McKinley West, Fort Bonifacio, Taguig City | 11,586.16 | 80% pro indiviso own |
| Building | Five West Campus, 15 Le Grand Avenue, McKinley West, Fort Bonifacio, Taguig City | 12,884.02 | 80% pro indiviso own |
| Contract price, valuation and the methods used to value the assets |
Subscription price is Php5.274 billion. The Fairness Opinion was undertaken by Navarro Amper & Co./Deloitte Philippines. The Valuation Report on the Properties was prepared by the third party and independent appraiser and property valuer, Santos Knight Frank, Inc. on the basis of the Income Approach in compliance with International Valuation Standards. |
| Terms of payment |
The shares shall be issued in the name of Megaworld, and the properties transferred, upon confirmation by the Securities and Exchange Commission of the valuation of the Properties. |
| Conditions precedent to closing of the transaction, if any |
Confirmation by the Securities and Exchange Commission of the valuation of the Properties |
| Any other salient terms |
The transaction shall result in an increase of control and ownership of Megaworld in MREIT from 62.09% to 65.67%. The property-for-share swap transaction shall be pursued as a tax-free exchange under Sec. 40(c)(2) of the National Internal Revenue Code, as amended. |
| Name | Nature of any material relationship with the Issuer, their directors/ officers, or any of their affiliates |
| Megaworld Corporation | Megaworld is the Sponsor and 62.09%-owner of MREIT, Inc. |
| Discussion on the probable impact of the transaction on the business, financials and other aspects of the REIT |
The transaction shall result in increase in MREIT's total office GLA to 324,742 square meters and an increase in the distributable income of its shareholders. The four (4) assets will start contributing to MREIT's revenues on April 1, 2022. |
| Other Relevant Information |
The transaction is pursuant to MREIT's investment plan to infuse around 100,000 square meters of additional office GLA before the end of 2022. The transaction represents the second wave of acquisitions in accordance with the investment plan, geared towards realizing the vision of making MREIT the largest office REIT in the Southeast Asian region. |
| Name | Ma. Georgina Alvarez |
| Designation | Chief Legal Consultant |