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Singapore stock market and companies daily report (City Developments, Rex Int’l Hldg, Singapore Post) (December 26, 2013)

December 26, 2013, Thursday, 05:58 GMT | 00:58 EST | 10:28 IST | 12:58 SGT
Contributed by Shares Investment

City Development’s Hotel Arm Acquires Hotel In London

- City Development’s hotel arm Millennium & Copthorne Hotels via its subsidiary, Millennium Hotels (West London), has acquired a hotel and its related hotel assets in the Chelsea district of London, England for a purchase consideration of GBP65 million (approximately $134.7 million).

- The hotel is a luxury property located within the Chelsea Harbour mixed-use development in London, SW10 0XG, that borders River Thames and offers 154 suites and four penthouses.

- The property to be acquired has a remaining leasehold term of approximately 98 years, while the acquisition is expected to be completed by 1Q14.

Significance: The hotel to be acquired is one of the few hotels in the city to offer an all-suite guest accommodation, and is situated in a riverside area along the prestigious River Thames, that is expected to undergo further infrastructure improvements in the near future.

Rex Int’l Hldg Suspends Drilling Activity In Exploration Well

- Rex International Holdings suspended drilling activity at its first exploration well, Masirah North North #1  (MNN #1) in Block 50 Oman due to safety reasons.

- The MNN #1 well was drilled to a total depth of approximately 1,000 metres below mean sea level. Mud losses in two carbonate sections of the well obstructed the planned target depth to be reached.

- A comprehensive data acquisition coring and logging programme of the formations that were drilled was completed on 21 December 2013. Data analysis indicates presence of non-commercial hydrocarbons.

Significance: Although a disappointment for Rex considering this is its first exploration well, however, the data acquired has assisted Rex’s partners in the Oman Block 50 project to identify a second exploration well as the next drilling location. It is anticipated that drilling at the new location will commence within the next two weeks.

Singpost Acquires Property In Malaysia

- Singapore Post (Singpost) via its subsidiary, Collective Developers agreed to acquire Axis Plaza, an office property located in Selangor Darul Ehsan, Malaysia for a purchase consideration of RM34 million (approximately $13.1 million).

- The property is acquired from Axis Real Investment Trust (REIT), the first Islamic office/industrial REIT in the world and has a portfolio of 31 assets with an estimated value of RM1.59 billion ($613.9 million) under management.

- The acquisition expected to be completed in end April 2014, will be financed by the use of both cash and bank borrowings.

Signficance: In line with Singpost’s transformation strategy to expand beyond Singapore, the acquisition will support the company’s core operations into Malaysia.