Advertisement
Link Reit seeks US$2.39 billion in fresh funds via rights issue as it looks to pay debts, acquire new investments
- Asia’s largest real estate trust is seeking to raise about HK$18.8 billion (US$2.39 billion) in capital by way of a rights issue
- Some analysts questioned the wisdom of the plan at a time when the property market is struggling
Reading Time:3 minutes
Why you can trust SCMP
2
Hong Kong-based Link Reit, Asia’s largest real estate investment trust, is seeking to raise about HK$18.8 billion (US$2.39 billion) in capital by way of a rights issue, an announcement that took some market observers by surprise.
Advertisement
Some 40 to 50 per cent of the proceeds will be used to repay debts and for general working capital, company executives said in a briefing on Friday evening, after trading on the Hong Kong stock exchange closed.
“The proposed rights issue will strengthen Link Reit’s capital base and position us to capture accretive investment opportunities amid real estate markets’ repricing,” said Link Reit chairman Nicholas Allen.
“It will further solidify our position as a leading Asia-Pacific real estate investor and manager.”
The move seeks to bring Link Reit’s net gearing – the proportion of debt versus equity – down to below 20 per cent.
06:47
Living in 15 sq ft: Inside Hong Kong’s coffin homes
Living in 15 sq ft: Inside Hong Kong’s coffin homes
The rights issue is “a bit beyond expectations,” said Liu Jieqi, senior property analyst at UOB Kay Hian.
Advertisement