Friday, January 18, 2013

GLP

GLP: will sell 3 of its Japan properties to GLP J-REIT for ¥12.6b (US$142m), in line with the appraised value of assets. Recall GLP had granted purchase options on these three properties in Nov ’12. J-REIT will use the net proceeds of ¥5.1b (US$58m) arising from exercise of the over-allotment option at IPO, to acquire the assets. The transaction is expected to be completed on 1 Feb ’13. J-REIT has a “right of first look” over GLP’s remaining 35 wholly owned properties in Japan. GLP’s unitholding in J-REIT is expected to decrease from 15.75% to 15% as a results of the exercise of over-allotment option. Daiwa raises to Outperform with TP $3.09, now values “stable” part of the portfolio at book, and the “high-growth devt” portion at 2.5x P/B, to better quantify the benefit from spin off of GLP J-REIT in Japan.

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