Ayala Land Inc. has raised P3.47 billion from the sale of shares of AREIT Inc., its real estate investment trust, which it received from a property-for-share swap.
In a disclosure to the Philippine Stock Exchange, ALI said it sold 87.37 million AREIT shares at a transaction price of P39.70 per share.
The shares sold to qualified institutional buyers in the US as well as in the Philippines. The sale of the Offer Shares is exempt from the registration requirements of the SRC, and the said shares were not registered with the Securities and Exchange Commission.
“Any future offer or sale of the Offer Shares by the buyers thereof in the Philippines is subject to the registration requirements of the SRC unless such offer or sale qualifies as an exempt transaction in accordance with the applicable requirements of the SRC,” ALI noted.
The proceeds from the block sale shall be settled on May 2, 2022, under the Placement Agreement between the ALI and AREIT.
ALI said it will submit the required Reinvestment Plan detailing the use of proceeds obtained from the share sale transaction in due course.
AREIT stockholders have recently approved the firm’s second property-for-share swap worth P11.26 billion with its sponsor ALI.
The transaction involves six Cebu-based office buildings in exchange for 252.14 million AREIT primary common shares at a price of P44.65 per share, as validated by a third-party fairness opinion.
This new asset infusion will expand AREIT’s gross leasing area to 673 thousand square meters or P64 billion in Assets Under Management (AUM) in 2022 – a 113 percent increase since AREIT went public.
This growth exceeds its target to double in size within two years from its IPO. With this prospective infusion of Cebu assets, AREIT's dividend per share is projected to increase further.
AREIT's full-year dividends from its 2021 income totaled P1.77 per share, a 34 percent increase from 2020 and 12 percent higher than its REIT plan projection during the IPO.
The six buildings are eBloc Towers 1 to 4 located at Cebu IT Park, ACC Tower and Tech Tower located at Ayala Center Cebu. The office buildings have a total gross leasable area (GLA) of 124,299 square meters with an overall occupancy rate of 97 percent, leased by major BPOs in the country.
AREIT started with 153,000 sq.m. equivalent to P30 billion of Assets Under Management (AUM) in 2020. By December 2021, this has grown to 549,000 sq.m., equivalent to P53 billion in AUM.