$1.73 Decent Exit Price For Ascott: CIMB

Source : Today, Wednesday, January 30, 2008

CapitaLand’s offer to buy the remaining shares of its 67-per-cent unit, The Ascott Group, at $1.73 apiece represents a decent exit price for minority owners of the luxury residences operator, according to CIMB, who said the price “is a fair valuation from a historical perspective, but attractive in the current environment of heightened risk aversion”.

Stock markets worldwide have been rocked in recent months by the fallout from the US sub-prime mortgage fiasco, and banks and property counters have bore the brunt of the volatility. The ST Index is down about 12 per cent since the beginning of the year.

In its offer document despatched to Ascott shareholders yesterday, CapitaLand’s fully-owned Somerset Capital unit said the offer was unconditional in all aspects and that payment would be disbursed 10 days after the receipt of acceptances. The offer will close on Feb 26 and the offer price will not be revised. CapitaLand intends to take Ascott private and will exercise its rights of compulsory acquisition.