OUE Commercial REIT proposed acquisition of an indirect interest in One Raffles Place

OUE Commercial REIT announced that it has entered into a conditional sale and purchase agreement with its sponsor OUE Limited to acquire an indirect interest in One Raffles Place via the acquisition of between 75.0% and 83.33% interest in OUB Centre Limited (OUBC). OUBC is the registered owner of One Raffles Place and owns 81.54% of the beneficial interest in One Raffles Place. Depending on the stake acquired, the purchase consideration is expected to be between S$1,034m and S$1,148.8m. The proposed acquisition is expected to be funded by a combination of debt and equity, with the exact breakdown to be announced in the future. As this is an interested person transaction, unitholders’ approval will be required. We maintain our BUY rating but will review our fair value estimate of S$0.88.