OUE Lippo Healthcare to buy stakes in First REIT for $142m

They will issue 2.22 billion new shares to raise $150m for the project's funding.

OUE Lippo Healthcare (OUELH) will acquire 10.63% of First REIT’s total issued units and 40% stake in First REIT’s manager Bowsprit Capital Corporation for approximately $142m, an announcement revealed.

First REIT is the Singapore Exchange - Securities Trading’s (SGX-ST) first listed healthcare real estate investment trust which has a portfolio of 20 healthcare-related properties with stable cash flows and long lease terms across Indonesia, Singapore, and South Korea.

In order to fund said acquisitions, OUELHL will launch a renounceable underwritten rights issue to raise $150m. They are looking to issue 2.22 billion new shares at an issue price of $0.068.

“They [proposed acquisitions] enable the company to diversify into a key healthcare market such as Indonesia,” OUELH chairman Lee Yi Shyan commented. “Further, they fit well with our asset-light growth model and thirdly, they are earnings accretive, which enhances shareholders’ value.“

The firm has appointed OCBC as its sole financial advisor for the proposed acquisitions as well as the manager and underwriter for the rights issuance.