CapitaLand/ CapitaMalls Asia

CapitaLand/ CapitaMalls Asia (CMA): CapitaLand launches voluntary conditional cash offer of $2.22 (vs last closing price of $1.80) for CMA, with a view for delisting if CapitaLand receives acceptances of >90%. Currently, CapitaLand holds 65.3% of CMA. The offer will be funded through a combination of internal cash resources and borrowings of CapitaLand and its subsidiaries (CapitaLand Group), excluding those of CMA Group. The offer price will be reduced for any CMA dividend or distribution on or after the announcement date, including the currently proposed CMA final dividend of $0.0175/share for FY2013. Rationale for CapitaLand includes full integration within the group in integrated developments to enhance overall project returns, simplify its organizational structure and increase its financial flexibility and scale. The accretive acquisition for CapitaLand will raise EPS by 21.5% and improve ROE from 5.4% to 6.7% on a proforma basis, assuming a full privatisation of CMA.