Yoma eyes acquiring 80% stake in Yangon-based site

It is ready to shell out S$99.16m.

According to OCBC, Yoma proposed to acquire from SPA (Myanmar) Ltd, an 80% interest in a 10-acre site in central Yangon for S$99.16m (US$81.28m).

Here's more from OCBC:

We believe this to be a reasonable price in the lower half of our range of estimates. The development, situated between Trader’s Hotel and Bogyoke Aung San Market, is envisioned to be a mixed-use project consisting of residential, retail, hospitality and commercial components with a GFA of approximately two million sq ft.

The site currently holds FMI Centre Tower and the former Railway Headquarters – a well-known heritage building in Yangon. Under current plans, the Railway Headquarters would be converted into a luxury hotel, to which a condominium building would be adjoined.

The development would also consist of a 4-star hotel and serviced apartment complex, two Grade A office towers with over 700k sq ft of GFA, and a retail mall with over 400k sq ft GFA.

Under the existing share issue mandate, Yoma will undertake a 1-for-4 rights issue for up to ~289m new shares to finance the acquisition at a 25%-35% discount to the closing price at a date to be determined.

The timing of the issue, dependent on shareholder approval of the acquisition, is likely to be in 1Q13.

In addition, Yoma also announced that it intends to carry out a private placement of 193m new shares at S$0.525 each that would raise S$101m. Note these placement shares are entitled to participation in the proposed rights issue.

This is to further finance the project development, estimated at US$330m-S$350m and expected to be carried out in phases.