OUE COM Reit Rights Issue

OUE COM Reit proposes an acquisition of an indirect interest of One Raffles Places through the acquisition of between 75% to 83.33% of OUB Centre Limited from OUE Ltd (the sponsor).Valuation of OUBC interest is at around $1734m from two independent valuers.Funding of the acquisition is a mixture of voluntary rights ($218.3m), CPPU ($500m to $550m) and debt($333.3m to $399.3m). The 9-for-20 rights issue at $0.555 will result in a TERP of $0.731 per share based on yesterday closing price of $0.81.The CPPU will be issued to the Sponsor for an annual coupon of 1% per year with a restriction period of 4 years.The CPPU will be classified as equity with a conversion price of $0.841 with no more than one third of the CPPU initially issued can be converted in any one year. This represent a 15% discount over the TERP.Assuming a 75% indirect interest, leverage will be at 40.9% of the enlarged portfolio.