AREIT Inc., the listed real estate investment trust of the Ayala Group, and Buendia Christiana Holdings Corp. have finalized a property-for-share swap valued at P6.77 billion.
AREIT will issue 199.1 million shares to BCHC, a wholly-owned subsidiary of ACEN Corp., the renewable energy unit of the Ayala Group, in exchange for land totaling 275.9 hectares in Zambales. The shares were priced at P34.00 each, a 3.75 percent premium over AREIT’s 30-day volume-weighted average price of P32.77.
Earlier this year, AREIT and BCHC executed a Deed of Exchange, pending approval from the Securities and Exchange Commission. This swap coincides with AREIT’s transactions with Ayala Land Inc.
The SEC approved the transaction on 26 September. Following this approval, ACEN, through its subsidiary BCHC, will hold 6.20 percent of AREIT, contingent on obtaining the Certificate of Authorizing Registration from the Bureau of Internal Revenue and fulfilling SEC conditions.
The property valuation was derived from initial earnings before interest, taxes, depreciation and amortization using a capitalization rate of 6.92 percent. FTI Consulting provided a valuation and fairness opinion, utilizing the Discounted Cash Flow method primarily, alongside other comparative methods.
BCHC will be a shareholder in a listed company, allowing it to receive dividends. Giga Ace 8, Inc., a subsidiary of ACEN, will lease the land from AREIT for 25 years, with guaranteed rent increases and an option to renew for another 25 years.
