Quarz says it and its affiliates hold stakes that rank them among the top 10 unit holders of MNACT
Activist investor Quarz Capital Management said it is opposed to the terms of a proposed US$3.1 billion merger of two Temasek-linked Singapore real estate investment trusts (REITs), saying the target firm was significantly undervalued.
It is urging Mapletree North Asia Commercial Trust (MNACT) to negotiate an improved offer from Mapletree Commercial Trust (MCT), according to a Feb. 9 open letter reviewed by Reuters.
Quarz, which has previously been successful in blocking a Singapore REIT deal, says it and its affiliates hold stakes that rank them among the top 10 unit holders of MNACT.
In a report published on research platform Smartkarma on Friday, analyst Travis Lundy said Quarz had provided many statements in its letter about how things would change on the MNACT side once the COVID-19 pandemic ended but had not addressed the impact on MCT.
MNACT’s main portfolio includes one commercial property in Hong Kong and two in China, while MCT is a Singapore-focused REIT.
On Thursday, MNACT’s units were down 1.8% at one time and ended up 0.9% on the day at US$0.83. On Friday, MNACT’s units traded 1.8% lower.
We note that Quarz acknowledges the deal rationale, and sees value in MNACT, MCT’s manager said in a response to Reuters, but did not elaborate.
MNACT’s manager said it continued to believe that the rationale and terms of the proposed merger were beneficial to unit holders from a strategic and financial perspective.
Singapore state investor Temasek’s Mapletree Investments Pte Ltd, a global real estate conglomerate, is the single largest unit holder in both real estate investment trusts, owning 32.6% of MCT and 38.1% of MNACT as of Dec. 29.
