NTT seeks up to US$864 million in data centre Reit's Singapore IPO

[SYDNEY/SINGAPORE] Japanese telecom giant NTT is seeking to raise roughly US$864 million in a Singapore IPO for a data centre Reit if an overallotment option is included, according to a term sheet that marked the start of the bookbuilding process.

NTT DC Reit’s portfolio comprises six data centre assets located in the United States, Austria and Singapore, according to a preliminary prospectus filed on Friday.

The value of the base offering is between US$772 million and US$812 million, while the overallotment option would add another US$51.5 million, the term sheet showed.

“We are not able to provide further details except for those officially announced by our company,” NTT said in an emailed response to Reuters’ request seeking comment on Monday (Jun 30).

If the yield is priced at 7.5 per cent, the overallotment would exercised. If fully exercised, NTT would be left with a 20 per cent stake in the Reit.

The Reit is being marketed at an indicative forecast distribution yield of 7 per cent to 7.5 per cent for July-March on an annualised basis and 7.29 per cent to 7.80 per cent for the next financial year.

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The Reit would have a market cap of up to US$1.08 billion, the term sheet also showed.

Bookbuilding is due to end on Friday with listing set for July 14.

Cornerstone investors in the IPO include Singapore’s sovereign wealth fund GIC with a US$101 million investment, according to the term sheet.

The Singapore Exchange has seen growing interest from companies seeking to list after it announced measures in February to strengthen its equities market, including a 20 per cent tax rebate for primary listings.

Hong Kong-listed China Medical System said last week it had applied for a secondary listing of its shares on the bourse. Other companies seeking to list in Singapore include the city-state’s Foundation Healthcare Holdings.

IPO proceeds raised on the Singapore Exchange surged more than five-fold to US$331.6 million in the first half of this year from a year earlier, while the last listing of similar size was a US$977 million IPO for Digital Core REIT in 2021, according to LSEG. REUTERS