Boustead Projects, through its wholly-owned subsidiary, BP-Real Estate Investments, has, together with Roark Capital and Lim Teck Lee Investments (collectively the purchasers), entered into a notes purchase agreement (NPA) with Onward Capital, Fabia Enterprises, Good Crown and Key Trading (collectively the vendors).
The agreement stipulates that the purchasers agree to acquire $110 million in principal notes due Nov 30, 2020 issued by SC Aetas (Cayman) under the subscription agreements dated July 29, 2019.
Each purchaser will acquire the same proportion of notes from the vendors according to the July 2019 agreement.
Upon completion of the NPA, Boustead will own 50% of all of the notes through BP-Real Estate Investments. Roark Capital and Lim Teck Lee Investments, which are investment holding companies of private investors, will each own 25% of the notes.
The notes have the benefit of the trust deed dated July 29, 2019, that was entered into by SC Aetas and Lion Trust (Singapore).
They are secured by a charge over the shares in SC Aetas Holdings, the Singapore subsidiary of SC Aetas.
Lion Trust was also granted an option to purchase all of the shares in SC Aetas Holdings, which only has one ordinary share as at Aug 12.
Upon the exercise and completion of the call option, Lion Trust would become the sole shareholder of SC Aetas Holdings, which owns Orchard Hills Residences at 30 Bideford Road.
Orchard Hills Residences has been developed as an 18-storey mixed development, with a site area of 2,006.9 sqm and gross floor area (GFA) of 14,637.89 sqm.
The property has a carrying value of $720.2 million as at March 31.
There is an existing loan owed by SC Aetas Holdings to the senior secured creditors, secured by a mortgage over Orchard Hills Residences.
Following the proposed transaction, the purchasers may take legal and beneficial ownership of the property through the enforcement of the security granted in respect of the notes; through the acquisition of the property following any enforcement proceedings; or by acquiring the property through an auction or bilateral sale process.
Should ownership be procured, the potential acquisition will be beneficial to Boustead’s property investment and fund management business.
The purchasers, through the holding of the notes, also own interests in the property.
Closing of the NPA is expected to take place on Aug 13.
As at 9.46am, shares in Boustead Projects are trading flat at $1.03.
