Parkway Reit eyes $370m in stock sale
PARKWAY Holdings, Asia’s second-biggest listed operator of hospitals, has said it will price the shares of its real estate investment trust (Reit) at $1.28 each to raise $369.8 million in a stock sale.
Parkway Life Reit, which will hold the company’s three hospitals in Singapore, is pricing 288.9 million shares near the top end of the $1 to $1.34 range it announced last month.
The company is raising funds to invest in health-care assets in Asia, it said in a filing to the Monetary Authority of Singapore yesterday.
‘The Asian health-care industry is expected to grow due to factors such as strong economic growth, rising personal income, increased awareness and expectation towards health care,’ the company said in the filing. The trust will offer a yield of 4.9 per cent for next year and 5 per cent for 2009.
Parkway Life Reit joins 17 other Reits in Singapore, a market valued at $18 billion, according to Bloomberg data. The trust will be the second Reit in Singapore that has hospitals in its portfolio, after the Lippo Group’s share sale for its First Reit, which owns three Indonesian hospitals and a country club.
Parkway Life Reit plans to double its assets in the next two years, Ms Lim Sze Mei, vice-president of finances and investor relations at the trust’s manager, said after a conference in Singapore yesterday. The trust has $774.6 million worth of assets now.
The Reit also plans to fund acquisitions using debt, Ms Lim said, adding that it is working on getting a credit rating that would allow the trust to borrow as much as 60 per cent of its assets.
The trust is also planning to invest more in Singapore and expects an announcement in the next six months.
Parkway Holdings said it will hold at least 30.1 per cent of the trust after its Reit goes public.
Source : Straits Times - 08 Aug 2007
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