RAM Ratings withdraws preliminary ratings of IGB Commercial REIT's RM850m debt notes

TheEdge Tue, Sep 21, 2021 11:52am - 2 years View Original


KUALA LUMPUR (Sept 21): RAM Rating Services Bhd (RAM Ratings) has withdrawn the preliminary ratings assigned to the RM850 million First Tranche Medium Term Notes (MTN) of IGB Commercial REIT Capital Sdn Bhd’s (the issuer) perpetual RM5 billion MTN programme.

The rating agency said the decision followed by the company’s request for the withdrawal of its debt ratings.

“As such, we no longer have any rating obligations in respect of the First Tranche MTN,” said the rating agency in a statement on its website.

IGB Commercial Real Estate Investment Trust (IGBCR), which closed lower by one sen or 1.41% at 70 sen on its maiden trading day yesterday, continued to retreat today.

The counter opened lower at 66 sen and hit a high of 68 sen. However, it dropped to 63 sen by mid-morning, which was seven sen or 10% lower than its closing price of 70 sen yesterday.

Its initial public offering (IPO) price was set at 71 sen apiece. Notably, the institutional price of 71 sen was lower than the indicative price of 83 sen apiece set for its book-building exercise.

IGBCR units were also offered to shareholders of IGB Bhd through a restricted offer for sale (ROFS), where IGB Bhd shareholders were entitled to subscribe to two ROFS units at RM1 each for every five shares held. In addition, shareholders who subscribed to the ROFS were entitled to distribution in species (DIS) on the basis of three DIS units for every two ROFS units subscribed.

That means IGB Bhd shareholders will be paying RM2 for five units of IGBCR, representing 40 sen each, nearly a 44% discount over the institutional price of 71 sen.

However, the ROFS received a lukewarm response with the REIT manager receiving valid acceptance of only 241.95 million ROFS units and 362.92 million corresponding DIS units, implying a subscription rate of 78.72% out of the total 307.34 million ROFS units and 461 million corresponding DIS units.

Notably, the REIT’s assets include Menara IGB, IGB Annexe, Centrepoint South, Centrepoint North, Boulevard Properties, the Gardens South Tower, Gardens North Tower and Southpoint Properties at Mid Valley City.

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