A proposed merger of two Singapore trusts could result in APAC’s biggest trust worth S$7.6 billion

The merger, if approved, will see Ascendas Hospitality Trust delisted from the stock exchange. It has a portfolio of 14 hotels in APAC, including Park Hotel Clarke Quay.
Facebook/Park Hotel Clark Quay

Singapore might soon be home to APAC’s largest-ever hospitality trust worth S$7.6 billion (US$6.5 billion), if the investors of Ascott Residence Trust (Ascott Reit) and Ascendas Hospitality Trust (A-HTRUST) approve a proposed merger.

Ascott Reit, a CapitaLand subsidiary, has a portfolio of 74 properties around the world, most of which are serviced residences such as Ascott Orchard Singapore.

Meanwhile, A-HTRUST’s portfolio includes 14 hotels in APAC, including Park Hotel Clarke Quay.

The proposed merger will see Ascott Reit acquire all of A-HTRUST’s Stapled Units for $1.0868 per unit. A-HTRUST will then be delisted from the Singapore stock exchange, Capitaland said in a statement on Wednesday (July 7).

A Stapled Unit refers to two contractually-bound securities, such as shares and trust units, that cannot be traded separately.

Ascott Reit will then create a new entity, Ascott Hospitality Business Trust (Ascott BT), which will combine all Ascott Reit’s units with Ascott BT units to form a stapled trust, Ascott Reit-BT.

The proposed transaction will be put up for investors’ approval at the trusts’ annual general meetings and scheme meetings later this year, CapitaLand said.

If the merger goes through, the new entity stands to become the world’s eight-biggest hospitality trust, and its increased number of properties – a total of 88 – is expected to make it more attractive to investors.

It will also be able to acquire and build more properties, Ascott Residence Trust Management Limited CEO Beh Siew Kim said.

In terms of asset value, it is poised to become the seventh largest trust listed on the Singapore Exchange.

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