CapitaLand acquires additional $69.7m interest in Raffles City China Fund

Part of its PRC expansion strategy.

In a release, CapitaLand Limited (“CapitaLand”) announced the acquisition of an additional 4.39% interest in Raffles City China Fund Limited (RCCF) for a cash consideration of US$69.7 million (approximately S$86.1 million).

The Acquisition was made by CapitaLand through its wholly-owned subsidiary, CapitaLand China (RCCF) Holdings Limited (CapitaLand China RCCF), entering into a sale and purchase agreement with an existing investor of the Fund, an unrelated third party, to acquire its entire 4.39% interest, representing 5,000 redeemable preference shares, in the Fund.

The Acquisition is part of CapitaLand’s ongoing business development and is in line with CapitaLand’s strategy to further strengthen its presence in the People’s Republic of China (PRC).

The Fund, an exempted company with limited liability and incorporated in the Cayman Islands, is an integrated development private equity fund which had been established with an investment focus on Raffles City brand projects in the PRC. The Fund’s portfolio comprises Raffles City Shanghai, Raffles City Beijing, Raffles City Chengdu, Raffles City Hangzhou and Raffles City Ningbo.

The Consideration was arrived at on a willing-buyer and willing-seller basis, taking into account, amongst other factors, the net asset value of the Fund of US$1,848.9 million (approximately S$2,284.9 million) based on its consolidated management accounts as of 30 September 2012.

Prior to the Acquisition, CapitaLand had an effective 45.43% interest in the Fund through CapitaLand China RCCF and CMA RCCF Investment (BVI) Limited (CMA RCCF) which respectively has a 35.61% and a 15% interest in the Fund. CMA RCCF is a wholly-owned subsidiary of CapitaMalls Asia Limited which is in turn 65.44% owned by CapitaLand.

Following the Acquisition, CapitaLand’s effective interest in the Fund has increased from 45.43% to 49.82% and the Fund remains an associated company of CapitaLand.