Sabana REIT soars on news of possible buyout by e-Shang Redwood

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Units of Singapore-listed Sabana REIT finished more than 10% higher than the previous close on the Singapore Exchange on rumours that it will be bought over by Warburg Pincus-backed developer e-Shang Redwood.

Reuters reported on 7 August, citing anonymous sources close to the process, that ESR was in “advanced talks” to buy the struggling REIT, and that the talks would complete in a “few months”.

In a clarification announcement posted on the same day, Sabana REIT confirmed that it is currently in discussions with the manager of ESR-REIT, which was formerly known as Cambridge Industrial Trust, as part of its strategic review process.

Cambridge Industrial Trust was rebranded as ESR-REIT after e-Shang Redwood acquired a majority interest in the REIT’s manager, Cambridge Industrial Trust Management Limited.

“At this point, Sabana REIT has not entered into any definitive legally binding agreement with ESR-REIT”, the former clarified in its announcement.

“Accordingly, there can be no assurance that any transaction or agreements will eventually materialise pursuant to these discussions”, Sabana REIT emphasised, noting that it will make necessary announcements in accordance with its obligations under the listing rules as and when there are any material developments arising out of the strategic review exercise.

“In the meantime, unitholders are advised to exercise caution when dealing in the units of Sabana REIT”, it added.

Units of Sabana REIT last changed hands on the Singapore Exchange at SGD0.49.

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Ridzwan Rahmat has been analysing Singapore-listed REITs and business trusts, since 2008. For disclosure purposes, Ridzwan is currently vested in Mapletree Greater China Commercial Trust, Mapletree Industrial REIT and Mapletree Logistics Trust.

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