(Updated)

IGB Commercial REIT units slip below IPO price in stock exchange debut

IGB Commercial REIT units slip below IPO price in stock exchange debut
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KUALA LUMPUR (Sept 20): IGB Commercial Real Estate Investment Trust's (IGBCR) stock exchange debut on Monday saw its unit price slipping below the institutional portion of its initial public offering (IPO) price.

The price of the institutional portion of its IPO was set at 71 sen apiece.

At 10.10am, IGBCR’s unit price stood at 70 sen apiece, with a total of 11.12 million units traded. 

The counter opened at 73 sen today and hit a high of 74 sen. However, it slipped quickly to 70 sen by mid-morning, where it stayed until the close of trading hours.

Notably, the institutional price of 71 sen price was lower than the indicative price of 83 sen apiece set for its book-building exercise. 

IGBCR units were also offered to shareholders of IGB Bhd through a restricted offer for sale (ROFS), where IGB Bhd shareholders were entitled to subscribe to two ROFS units at RM1 each for every five shares held. In addition, shareholders who subscribed to the ROFS were entitled to distribution in species (DIS) on the basis of three DIS units for every two ROFS units subscribed. 

That means IGB Bhd shareholders will be paying RM2 for five units of IGBCR, representing 40 sen each, nearly a 44% discount over the institutional price of 71 sen. 

However, the ROFS received a lukewarm response with the real estate investment trust's (REIT) manager receiving valid acceptance of only 241.95 million ROFS units and 362.92 million corresponding DIS units, implying a subscription rate of 78.72% out of the total 307.34 million ROFS units and 461 million corresponding DIS units. 

Notably, the REIT’s assets include Menara IGB, IGB Annexe, Centrepoint South, Centrepoint North, Boulevard Properties, the Gardens South Tower, Gardens North Tower and Southpoint Properties at Mid Valley City. 

Surin Murugiah