Indiabulls plans IPO to offer investment trust in Singapore

Mumbai: Indiabulls Real Estate is planning to make an initial public offering of a real estate investment trust in Singapore. The company said it has filed its prospectus with Monetary Authority of Singapore for its Indiabulls Properties Investment Trust (IPIT), said the company in a notice to the Indian stock exchanges.

This is the third Indian company, after DLF and Unitech to consider overseas listing of its REIT. The trust is contemplating offer of its units for subscription by investors including the public in Singapore by way of an initial public offering.

Deutsche Bank and Merrill Lynch are handling the deal, which will see Indiabulls inject into the trust two freehold projects with 3.4 million sq ft of space, to be constructed by August 2008.

IPIT, which is a business trust registered under the laws of Singapore, had been granted the ‘Eligibility to list’ by the Singapore Exchange Securities Trading Ltd (SGX-ST), the company had said on February 5.

The company had also informed the stock exchanges in February that the trust will acquire the One Indiabulls Centre and Elphinstone Mills (Properties) developed and owned by Indiabulls Properties Pvt Ltd (IPPL) and Indiabulls Real Estate Company Pvt Ltd (IRECPL) respectively. These properties are held by Indiabulls Real Estate project Ltd (IBREL) through investments in IPPL and IRECPL.

Indiabulls Real Estate Ltd is committed to supporting IPIT over the long term and after the listing date expects to hold a specified number of units of IPIT, upon the completion of the offering, a statement from the company said.

The company has also received approval from the High Court in the Isle of Man to acquire Dev Property Development Plc, an Isle of Man registered company listed on the London Stock Exchange’s AIM. The merger would become effective from May 7.

Earlier in the month of March, the company had notified the stock exchanges about the approval from its board to purchase 100 per cent of the ordinary shares in Dev Property Development Plc, amounting to around invest £138 million (over Rs 1,000 crore).

Reuter adds: The last two REITs to list in Singapore — Lippo-Mapletree Indonesia Retail Trust on November 19 and Saizen REIT on November 9, tanked on their market debuts and are now trading as much as 30 per cent below their IPO price.

The poor market conditions sparked by the US sub-prime and credit crisis had caused Indiabulls, and fellow Indian developers Unitech and DLF, to postpone their planned Singapore REIT IPOs in March.

Analysts say the credit turmoil may force Singapore’s once-booming REIT sector which has 20 listed property trusts — to consolidate in coming months as financially weaker players sell assets or merge with their counterparts.