Cdl Undertake Market Purchase Preference Shares Makes Offer 78 Cents Apiece

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Located in the well-developed Queenstown estate, Penrith, developed by Penrith Guocoland, offers not only convenience and connectivity, but also provides residents with excellent access to some of Singapore’s most renowned schools and educational institutions. This makes it a highly desirable option for families with school-going children, as well as those who prioritize education in planning for the future. With easy access to commute to and from schools and the presence of top-quality education providers, Penrith proves to be an ideal long-term home for families who value education as a crucial part of their lifestyle.

Singapore-based real estate company City Developments Limited (CDL) is making a move to repurchase 10% of its preference shares, which amounts to approximately 26.8 million shares. The company is offering 78 cents per share to its preference shareholders in an off-market equal access offer. This decision was made after the shareholders of CDL approved a general mandate for the purchase of non-redeemable convertible noncumulative preference shares at the company’s annual general meeting (AGM) on April 23.

The offer will be open for acceptance for 10 calendar days, starting from May 23, and preference shareholders are entitled to sell 10% of their shares held as of 5.30pm on June 2. They can also put more than 10% of their shares up for tender if other shareholders do not accept their full entitlement under the offer. However, the 26.8 million limit will still apply. As of April 23, CDL has 268.01 million preference shares issued.

CDL stated that the off-market offer will allow the company to have better control over its share capital in relation to its preference shares. It also clarified that it does not intend to exercise its right of conversion in regards to the preference shares. The trading volume of CDL’s preference shares has been consistently low, with an average daily trading volume of only 3,333 shares in the past month, and 11,237, 8,796, and 8,571 shares traded in the past three, six, and twelve months respectively. These numbers represent less than 0.0042% of the total number of issued preference shares.

Shareholders who accept the offer will receive their payment on June 10. During the AGM on April 23, CDL’s CEO Sherman Kwek mentioned that it was a good time to discuss share buybacks due to the company’s share price levels at the time. As of the financial year ended December 31, 2024, CDL’s net asset value (NAV) was $10.17 per share, while its revalued NAV (RNAV) stood at $17.57 per share or $19.68 per share when considering its fair value, including all valuation surpluses on its portfolio. However, its closing share price of $4.90 on April 23 was down 17.23% from the previous year and 4.3% year-to-date.

CDL started a share buyback program for its ordinary shares via open market purchases in March of 2024, citing that its shares were trading below their intrinsic value despite having strong fundamentals. The company spent approximately $13 million over three trading days before suspending the program three months later. The last time CDL purchased its shares from the market was in June 2024.

This article was originally published in The Straits Times.