First REIT M&A in 15 years as ESR-REIT primes portfolio

SINGAPORE (Feb 12): On Jan 29, ESR-REIT announced that its manager was in exclusive discussions with the manager of Viva Industrial Trust to acquire all the units in VIT by  way of a trust scheme of arrangement. The period of exclusivity expires on March 31.

This is not the first time that ESR-REIT has attempted to acquire another industrial real estate investment trust. Just to recap, in ­November 2009, Cambridge Industrial Trust, as ESR-REIT was then known, made a hostile takeover bid. It attempted to oust the manager of MacarthurCook Industrial REIT and replace it with its own manager. It did this by accumulating a 10% stake in MacarthurCook Industrial REIT. It then publicised that it had no plans to merge the two REITs. The Monetary Authority of Singapore announced in the same month that year that the same manager should not be able to manage two REITs, as that breached regulations on conflict of interest.

In addition, Cambridge did not have the solution or the financing in place to resolve MacarthurCook Industrial REIT’s debt problems.

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