Cuscaden Peak bid for SPH clears key regulatory hurdles in Singapore

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Cuscaden Peak’s late-entry bid to snatch SPH from Keppel’s grasp has cleared key regulatory hurdles in Singapore, moving its offer closer to the finish line.

The consortium announced on Sunday the Monetary Authority of Singapore (MAS) had given the go-ahead to permit the change of control of SPH REIT‘s manager and the acquisition of effective control of KBS US Property Management.

In addition, the Info-Communications Media Development Authority (IMDA) approved Cuscaden Peak’s acquisition of an indirect interest in telco M1 Ltd. if shareholders accept the consortium’s offer, according to a filing to SGX Sunday.

Cuscaden Peak said it is still awaiting clearance from Australia’s Foreign Investment Review Board as the only outstanding regulatory hurdle.

Christopher Lim, group executive director of Hotel Properties and the spokesperson for Cuscaden Peak, said the consortium was on track toward completing a deal by February 2022.

“We will continue to work expeditiously with SPH towards advancing the Cuscaden scheme for its shareholders to vote on,” Lim said in the statement, noting SPH’s deal with Keppel restricts sending documents to shareholders until after they vote on Keppel’s competing bid.

“Cuscaden views this restriction as against the interests of SPH shareholders,” Lim said, adding the consortium’s bid doesn’t require the approval of any shareholders but SPH’s. If SPH’s shareholders approve Keppel’s bid, Keppel’s shareholders would still need to vote on the offer.

Although SPH’s independent directors have preliminarily recommended shareholders accept Cuscaden’s bid, calling it “superior,” SPH’s shareholders must first reject Keppel’s bid at an upcoming meeting.

Cuscaden’s apparent winning bid — which values SPH at S$3.9 billion — will give shareholders the choice of either S$2.40 a share, including S$1.602 in cash and 0.782 SPH REIT unit valued at S$0.798 each, or an all-cash offer of S$2.36.

Previously, Keppel Corp. had sweetened its bid to acquire SPH to S$2.351 a share, in a cash-and-share offer, topping its previous bid of S$2.099 and a competing bid of S$2.10 in cash from Cuscaden Peak.

Keppel’s second offer had increased the cash component by S$0.20 a share, to S$0.868, as well as including 0.596 Keppel REIT unit and 0.782 SPH REIT unit.

Who is Cuscaden Peak?

The consortium bidding against Keppel, called Cuscaden Peak, includes Tiga Stars, a wholly owned subsidiary of tycoon Ong Beng Seng’s Hotel Properties, and Adenium, which is a wholly owned subsidiary of Temasek portfolio company CLA Real Estate Holdings, as well as Mapletree Investments‘ indirect wholly owned subsidiary Mapletree Fortress. Mapletree Investments is wholly owned by Singapore state-owned investment company Temasek.

Cuscaden Peak is 40 percent owned by Tiga Stars, 30 percent by Adenium and 30 percent by Mapletree Fortress. Tiga Stars is 70 percent owned by Hotel Properties, with the remainder held by Como Holdings, which is ultimately owned by Ong Beng Seng, who is the controlling shareholder of Singapore-listed Hotel Properties. Adenium is wholly owned by CLA Real Estate Holdings, which is an independently managed portfolio company of Temasek.