MNACT, MCT unveil '4R' post-merger strategy
The strategy includes changes in their divestment and acquisitions plans.
MapleTree Commercial Trust (MCT) and Mapletree North Asia Commercial Trust (MNACT) said they plan to implement a "4R" asset and capital management strategy to realise the benefits of their merger.
The first aspect of the strategy is to "recharge" the merged entity's net property income (NBPI) and distribution per unit (DPU) which they aim to do by "incorporating the best practices across the Merged Entity’s portfolio, "optimisation of tenant mix, and the pursuit of active asset management, accretive asset enhancement and redevelopment opportunities."
The merged entity's portfolio will also be "reconstituted" through "selective strategic divestments at an opportune time."
"The MCT Manager will also look to redeploy capital into higher-yielding quality properties or other asset enhancement and redevelopment opportunities to drive returns," MNACT said in response to queries from its unitholders.
Apart from divestments, the merged entity will also "refocus" its acquisition plans, adding office and office-like
business park assets anchored by tenants in high growth sectors to its roster of assets. In terms of markets, MNACT said the focus will include Singapore, South Korea, and select cities in China.
Lastly, the companies will work on "resilience" by adopting a comprehensive capital management strategy and employing an appropriate capital structure while optimising cost of debt, amongst others.
"Appropriate hedging strategies to manage interest rate and forex exposure will continue to be implemented to address risks posed by market volatility," MNACT added.
Read more of MNACT's responses to shareholder concerns on its upcoming merger here.
Related story: Net asset value for MCT units to increase to $1.81 after merger with MNACT