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MFLP in cash call to partially fund acquisition
Posted on Wednesday, 16 September 2020 13:18
Mitsui Fudosan Logistics Park (MFLP) has unveiled plans for a domestic and international offering worth about JPY 51.17 billion (USD 484.77 million) in the markets prior to the announcement.

The Japanese non-residential building real estate investment trust is selling 96,190 new units, representing a 17.9 per cent post-issue stake.

It has provided underwriters with an overallotment option for a further 4,710 securities.

The fundraising will enable MFLP “to obtain new real estate trust beneficiary interests that conform to its investment policy.”

In turn, this would help the company “enlarge its asset size, improve its portfolio quality, and further stabilise investment unit prices by growing its market capitalisation and raise the liquidity”.

It will also support MFLP in maintaining a stable financial position through appropriate control of its interest-bearing debt ratio.

However, the company intends to use some of the proceeds to acquire two logistics facilities for a total JPY 77.40 billion.

MFLP was established in 2016 by Mitsui Fudosan Logistics REIT Management and, as of 31st July 2020, held 18 properties amounting to a total acquisition price of JPY 205.00 billion.

The group raised JPY 29.74 billion via a public offering in February 2020, which meant it had unitholder capital of JPY 136.29 billion, as at 31st July 2020.

It had interest-bearing debt of JPY 62.90 billion and a debt to total assets ratio of was 30.2 per cent, as at the end of July.

Zephyr, the M&A database published by Bureau van Dijk, shows 11,058 capital increases have been announced globally in 2020 to date.

Of these, 660 cash calls are by companies based in Japan and the largest features HC Holdings raising USD 2.56 billion via a private placement of new type-A preferred shares to Mizuho Bank and Development Bank of Japan.

MFLP’s capital increase will be the tenth biggest by a Japanese company announced so far this year.

© Zephus Ltd