KUALA LUMPUR Aug 28 Malaysia's IGB Real Estate
Investment Trust has set a tight price range for the
institutional tranche of its up to $266 million IPO, according
to a term sheet seen by Reuters on Tuesday, indicating
confidence in demand for the offer.
The IPO, potentially the fourth largest in the Southeast
Asian country this year, will be offered to institutions at a
price range of 1.15 ringgit-1.25 ringgit per unit, the term
sheet showed. IGB Reit launched its retail offer on Monday, at a
maximum price of 1.25 ringgit per unit.
A wide indicative price range for an IPO would show that the
sponsors are testing the strength of demand for the offering,
while a narrow range shows they are reasonably certain about the
The unit of Malaysian property firm IGB Corp Bhd
is offering up to 670 million units in the IPO, comprising 469
million units for sale to institutional investors and another
201 million to employees and the public. Listing is set for
The bookbuilding range translates to a forecast 2013 yield
of 5.4 percent to 5.8 percent, according to the term sheet. The
book opens on Tuesday and closes no later than Sept 6.
Based on the top end of the IPO price, IGB Reit would have a
post-IPO market capitalisation of 4.25 billion ringgit ($1.37
billion), the largest in Malaysia ahead of Pavilion Real Estate
Investment Trust's 4.05 billion ringgit.
The property trust, which owns two Kuala Lumpur shopping
malls -- the Mid Valley Megamall and the Gardens Mall -- expects
to use the IPO proceeds for future expansion.
It has hired CIMB Investment Bank and Hong Leong Investment
Bank as the principal advisers and joint managing underwriters
for the IPO.
CIMB, Credit Suisse and Hong Leong are the joint global
coordinators, while CIMB, Citigroup, Credit Suisse, DBS,
Deutsche Bank, Goldman Sachs, Hong Leong, HSBC, JP Morgan and
Maybank are the joint book runners. Joint underwriters are
AmInvestment, CIMB, Hong Leong and Maybank.
($1 = 3.1095 Malaysian ringgits)
(Reporting By Yantoultra Ngui; Editing by Muralikumar