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Monday, February 26, 2024

AREIT shareholders approve P28.6-b share swap with ALI

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Shareholders of AREIT Inc. on Monday approved the P28.6 billion property-for-share swap deal with Ayala Land Inc. (ALI) and its subsidiaries.

AREIT said in a disclosure to the Philippine Stock Exchange its stockholders owning majority of its outstanding capital approved the resolution providing for the issuance of 841,259,410 primary common shares to ALI and its subsidiaries including Greenhaven Property Ventures Inc., Cebu Insular Hotel Co. Inc. and Buendia Christiana Holdings Corp., a wholly-owned subsidiary of ACEN Corp.

The approval was obtained during a special stockholders meeting.

The shares will be issued at P34 apiece, representing a 3.75-percent premium over 30-day volume weighted average price of P32.77 or the prevailing market price.

AREIT in exchange will acquire several properties from ALI and its subsidiaries including four commercial buildings at Ayala Center Makati and Ayala Center Cebu and a 276-hectare parcel of industrial land in Zambales province.

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The new infusions will bring AREIT’s assets under management (AUM) to P117 billion, its gross leasable building area to more than 1 million square meters and its leased industrial land area to 286 hectares by 2024.      

The deal will also support AREIT’s objectives to expand and diversify its portfolio to capitalize on various growth opportunities across real estate sectors.

Aside from the asset-share swap, AREIT recently acquired Seda Lio in El Nido, Palawan from ALI subsidiary Econorth Resort Ventures Inc. for P1.19 billion.

The acquisition is expected to immediately contribute to AREIT’s income in the first quarter of 2024.

Once the deal is finalized, AREIT is expected to conduct an equity offering to avoid breaching the required minimum public float requirement for real estate investment trust companies.

ALI sold in January 2024 P5.6 billion worth of AREIT shares to institutional investors. Analysts said, however, more AREIT shares needed to be placed out to maintain a 33-percent public float.

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