CICT to buy rest of CapitaSpring for S$1 billion; plans S$500 million placement between S$2.105 and S$2.142 a unit

CapitaLand Integrated Commercial Trust (CICT) on Tuesday (Aug 5) announced a proposed launch of more than 237.5 million new units to raise gross proceeds of around S$500 million, with a minimum offering price of S$2.105.

CICT is using the funds to finance the proposed S$1 billion acquisition of the remaining 55 per cent interest in the office and retail component of CapitaSpring it does not own.

The issue price range between S$2.105 and S$2.142 per new unit represents a discount of between around 4.1 and 5.7 per cent to the volume weighted average price (VWAP) of S$2.2334 per unit for trades of the units executed on Monday.

It also represents a discount of between about 1 per cent and 2.7 per cent to the adjusted VWAP of S$2.1637 per unit, said the manager of the trust.

Citigroup Global Markets Singapore, DBS and JP Morgan Securities Asia are collectively the joint bookrunners and underwriters. The companies entered into a placement agreement with the manager on Tuesday.

These new units are expected to be listed on the Singapore Exchange on Aug 14. The current expectation of the trust’s manager is that the quantum of distribution per existing unit held as at the close of Aug 13, under the cumulative distribution is estimated to be between S$0.0692 and S$0.0702. This comes on the back of CICT’s H1 distribution per unit (DPU) of S$0.0562, to be paid on or around Sep 18.

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The manager of CICT said that it intends to use around S$466.5 million or 93.3 per cent of these proceeds to finance the remaining 55 per cent interest in the office and retail component of CapitaSpring, located at 86 and 88 Market Street.

Another S$26.3 million or 5.3 per cent of the gross proceeds is set for the repayment and refinancing of debt and/or capital expenditure, as well as asset enhancement initiatives.

Lastly, S$7.2 million or 1.4 per cent of the gross proceeds of the private placement will be used to pay the estimated transaction-related expenses, including professional fees and expenses, incurred or to be incurred by CICT due to the private placement.

CICT also announced results for its first half ended Jun 30, 2025. DPU rose by 3.5 per cent to a new high of S$0.0562 supported by its highest-ever distributable income.

Distributable income rose 12.4 per cent year on year to S$411.9 million, from S$366.5 million. This increase is attributed to the income contribution from Ion Orchard, which was acquired in October 2024, better performance from existing properties and lower interest expenses.

However, the increase was partially offset by the divestment of 21 Collyer Quay in November 2024.

The higher DPU also came in spite of an enlarged unit base following last year’s equity fundraising exercise.

Revenue for the half-year period was down slightly by 0.5 per cent at S$787.6 million, from S$792 million in the same period a year earlier. This resulted in a corresponding 0.4 per cent decrease in its net property income to S$579.9 million from the previous year.

The manager of CICT attributed the decline primarily to the absence of income from 21 Collyer Quay, which was divested on Nov 11, 2024, and the ongoing asset enhancement initiatives of Gallileo, a commercial building in Frankfurt, Germany, since February 2024.

Units of CICT closed unchanged at S$2.24.