Ayala Land Inc. said its maiden real estate investment trust (REIT) initial public offer (IPO) received substantial interest, enough to have the firm offer to be twice oversubscribed.
“High-quality domestic and international institutional investors locked-in demand for the Philippines’ first REIT notwithstanding the continuing COVID-19 global pandemic,” Ayala Land said, noting that even allocations for trading participants were oversubscribed “with the participation of 96 eligible trading participants.”
“More than 3,300 investors participated in the offer via the LSI (local small investor) tranche,” the company added.
Ayala Land’s REIT sale is being done through unit AREIT Inc., which offered to the public an initial 47.86 million primary shares and another 409.02 secondary shares for the firm offer, plus 45.69 million secondary shares covering the overallotment option, at P27 apiece. Ayala Land, the REIT sponsor, is also a selling shareholder in the IPO.
Of the firm offer, 319.82 million shares were offered to qualified institutional buyers based in the Philippines, as well as overseas except the United States in accordance with the latter’s Regulation S rule.
Approximately 30 percent of the offer or 137,064,900 shares were offered to all REIT-eligible trading participants of the Philippine Stock Exchange (PSE) and to the LSI, Ayala Land said.
“The landmark deal and the introduction of the new asset class was well-received by the market, with the deal more than fully covered with broad distribution across retail investors as well as international and domestic institutional investors,” the company added.
AREIT offered its shares between July 20 to August 3, 2020. The shares will be listed with the PSE by August 13.
AREIT will gross P1.29 billion from the overall IPO proceeds, with the rest going to Ayala Land, which will be used to fund the acquisition of sister company Teleperformance Cebu from ALO Prime Realty Corp., an alternative property from Ayala Land, or any of its subsidiaries or affiliates, that “financially and strategically meets or exceeds Teleperformance Cebu and AREIT’s financial and strategic investment criteria.”
Ayala Land in a statement said the proceeds that will accrue to its balance sheet shall be reinvested in “real estate projects located in the Philippines within a period of one year from receipt thereof, consistent with applicable rules and regulations.”
BPI Capital Corp. was the sole global coordinator and joint bookrunner for the IPO, while UBS AG Singapore Branch acted as the sole international bookrunner for the international tranche of the IPO.
BPI Capital, PNB Capital and Investment Corp., and SB Capital Investment Corp. acted as the joint lead underwriters for the domestic tranche, and together with the sole international bookrunner, will underwrite the respective tranches of the IPO.