The firm said its MREIT shares were sold at an offer price of P13.00 per share, a discount to its closing price of P14.00 per share on July 20, 2023.
“On the back of strong demand led by domestic and international long-only investors, the Transaction was upsized by 10 percent from 254.0 million shares to 279.4 million shares,” said MREIT in a separate disclosure.
The block sale application will be filed with the PSE on July 21, 2023 and the proceeds from the block sale shall be settled on July 26, 2023.
“The Company will submit the required Reinvestment Plan detailing the use of proceeds from the block sale transaction,” said Megaworld.
UBS AG acted as Sole Placement Agent for the transaction. The shares were offered and sold to qualified institutional buyers both in and out of the United States of America including the Philippines.
Megaworld said it continues to be committed as a sponsor and the transaction increases MREIT’s free float which provides headroom for future acquisition of assets via property for share swap.
The firm said it will be using the proceeds from the transaction to fund further development of high quality commercial assets, helping to build on its existing portfolio and thereby expanding the pipeline of potential acquisition opportunities for MREIT.
“At the MREIT level, we are pleased to have several institutional investors on board. This investment demonstrates confidence in MREIT’s potential as a strong and attractive long-term investment opportunity,” said Megaworld Chief Strategy Officer and MREIT President and CEO Kevin L. Tan.
All the MREIT shares sold in the Transaction are owned by Megaworld and are secondary shares, ensuring that the ownership of existing shareholders of MREIT will not be diluted.
After the transaction, Megaworld will continue to hold a majority stake in MREIT with a 55.6 percent ownership.
Last month, MREIT also announced the signing of a memorandum of understanding (MOU) with its sponsor, Megaworld, for the possible acquisition of seven grade A office assets from Megaworld Corporation with a total gross leasable area of 150,500 square meters.
These assets are from Megaworld townships McKinley Hill, McKinley West, Iloilo Business Park, and Davao Park District. If concluded, MREIT’s portfolio will grow to 475,500 sqm, an increase of 46 percent from the current 325,000 sqm.
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The article was originally published in Manila Bulletin and written by James A Loyola
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