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HK’s ESR Cayman to buy ARA Asset for US$5.2b (Business Times)
Aug 6, 2021
Shared my thoughts with Business Times on ESR Cayman’s US$5.2b deal to acquire real estate fund manager ARA Asset Management. Don’t think it is cheap, but founder John Lim – Singapore’s latest billionaire – has a knack for delivering value. Its AUM has doubled to S$120b since its delisting in 2017, and it currently manages 18 REITs globally, including SGX-listed Suntec REIT, Cache Logistics Trust and ARA US Hospitality Trust.
Clear beneficiaries of this deal are Straits Trading (22% stake in ARA) and CapitaLand. The restructuring announced by the latter in March will see it privatising the development business and spinning off its real estate investment manager (REIM). With the ARA deal done at 20x EV/EBITDA, the value of CapitaLand just got more attractive.