Keppel DC REIT’s Ambitious S\$1 Billion Equity Fundraising: Key Details for Investors

Keppel DC REIT Management Pte. Ltd. has announced a bold move to raise approximately S\$1 billion through an equity fund raising initiative. This significant financial maneuver is set to unfold in three parts: a Private Placement, a Preferential Offering, and a Sponsor Subscription, all aimed at strategic growth and financial strengthening.

Key Highlights of the Equity Fundraising

• The Private Placement aims to raise at least S\$600 million by issuing new units at an issue price range between S\$2.074 and S\$2.128 per unit.
• The Preferential Offering targets gross proceeds of approximately S\$300 million, with new units priced between S\$2.03 and S\$2.08 each.
• The Sponsor Subscription, totaling around S\$85 million, will see Keppel DC Investment Holdings Pte. Ltd. support the initiative by subscribing to units at the Private Placement Issue Price.

Impactful Details for Shareholders

This equity fund raising is a strategic move that could potentially influence share prices due to its scale and underlying purpose. The initiative is primarily aimed at financing the acquisition of interests in two data centers in Singapore, which are integral to Keppel’s growth in the artificial-intelligence-ready hyperscale data center market.

• The fund will also be used to bolster the company’s balance sheet, decrease its aggregate leverage from 39.7% to 33.3%, and provide financial flexibility for future acquisitions and debt repayment.
• Keppel DC REIT’s unit base is expected to increase by approximately 27.1%, potentially enhancing trading liquidity and attracting more investor interest.

Important Considerations

Investors should note that the new units will not be entitled to an advanced distribution but will participate in distributions after their issuance. Additionally, the Private Placement and Preferential Offering are fully underwritten, ensuring that the fundraising targets are met.

There is an emphasis on compliance with Singapore’s SGX-ST requirements, ensuring transparency and adherence to regulations.

Investment Risks and Opportunities

While the fund raising presents opportunities for growth and enhanced market positioning, investors should be mindful of potential risks, including market volatility and the impact of the new unit issuance on current share value.

Disclaimer

This article is for informational purposes only and does not constitute financial advice. Investors should conduct their own research or consult financial advisors before making investment decisions. The information herein is based on current announcements and may be subject to change.