FPL, on June 13, 2022, offered to take FHT private at 70 cents per stapled security. The offer at the time represented a premium to FHT’s last-announced NAV of around 65 cents. It also stood above FHT’s historical trading multiples since its initial public offering (IPO). That said, it should be noted that FHT was listed in 2014 at 88 cents per stapled security with a forecast yield of 7%.
Investors should accept the privatisation offer proposed by Frasers Hospitality Trust (FHT), given the heightened uncertainty ahead and given that the trust is unlikely to return to the “good old days”, says Eric Gan, CEO of the trust’s managers. He adds that the macroeconomic environment was more conducive back then.
On May 14, FHT and its sponsor, Frasers Property Limited (FPL), jointly announced that FPL is seeking to take FHT private at 71 cents per share, implying a price to net asset value (P/NAV) of 1.11 times. This year’s privatisation offer marks FPL’s second attempt after its first offer in June 2022 fell through by a narrow margin.
