Malaysian sovereign wealth fund Khazanah Nasional Berhad and private equity firm TPG Rafter Holdings Ltd. are cashing out of realtor 8990 Holdings Inc.
Khazanah unit Pasir Salak Investments Limited and TPG are set to raise a combined P18.04 billion out of the P26.59 billion follow-on offering 8990 is eyeing.
Joining the two foreign investors in 8990 in the share sale is controlling shareholder iHoldings Inc., though the latter will automatically reinvest its windfall back into 8990 under the same terms of the share sale.
The Khazanah units are exiting 8990 nearly eight years since participating in 8990’s P9 billion follow-on offering in 2014. Reuters in a report pegged the two parties’ stake in 8990 to be worth P5.8 billion.
The share sale involves 1.4 billion shares, divided into an initial 1.25 billion shares and another 150 million to cover for the overallotment option, eyed to be sold at an offer price of up to P18.99 per share.
Pasir Salak and TPG are each selling 475 million shares of 8990, covering all its 17.62 percent holdings in the affordable housing developer. iHoldings is selling 450 million shares.
8990 said a similar amount of new shares will then be sold to iHoldings in a top-up transaction “at the same price of the offer shares” after the share sale, giving the company itself P8.54 billion in new funding.
“The company will not, directly or indirectly, receive any proceeds from the sale of the Pasir Salak offer shares and the TPG offer shares. Assuming a final offer price of P18.99 per offer share, it is estimated that Pasir Salak’s gross proceeds from the sale of the Pasir Salak offer shares will be approximately P9.02 billion ($177 million), and TPG’s gross proceeds from the sale of the TPG offer shares will be approximately P9.02 billion $177 million,” 8990 said.
The sale will be handled by Bank of America Securities and JP Morgan as joint global coordinator and bookrunners, with China Bank Capital Corp., and PNB Capital and Investment Corp. joining as joint domestic lead underwriters and joint bookrunners.
Of the top-up transaction proceeds, 8990 said it will use the amount to repay a number of bank loans worth P8.61 billion.
“These obligations may or may not be due and will make available credit lines for the company, which may be used for working capital, land banking and expansion plans,” 8990 said.
The company said it views the share sale “as a re-IPO (initial public offering) to re-introduce 8990 and share its story to international and local investors, increasing the public float and trading liquidity of the stock in the process.”
