Bangkok--21 Dec--Master Mind Communications
DTCPF received a huge response from both retail and institutional investors during its initial public offering (IPO) as drawn by Dusit’s goodwill, prime locations of its hotels and resort (Dusit Thani Laguna Phuket, dusitD2 chiang mai, and Dusit Thani Hua Hin), and attractive rates of returns. The THB 4.094 billion fund seeks to have its investment units listed on the stock exchange scheduled in mid-January 2011.
Mr Chanin Donavanik, Chief Executive Officer of Dusit Thani PCL (DTC), announced an overwhelming success of the 7-17 December initial public offering (IPO) of investment units in Dusit Thani Freehold and Leasehold Property Fund “DTCPF” in terms of subscription volume, thanks to retail and institutional investors’ firm trust in DTC. He expressed commitment of acting as properties managers to operate Dusit hotels in its best effort to ensure maximum efficiency that lives up to the expectation of the investors.
The investment policy of the THB 4.094 billion fund includes the acquisition of freehold interests in land, buildings and utilities as well as furniture, property, fixtures and equipment of Dusit Thani Laguna Phuket and dusitD2 chiang mai and a 30-year leasehold interest in land, buildings and utilities and own furniture, property, fixtures and equipment of Dusit Thani Hua Hin, with the freehold portion representing over 75% of all investments.
The fund was open for subscription during its IPO period of 7-17 December at the offering value of THB 10 each and the minimum subscription value of THB 10,000. The underwriters of the fund included CIMB Securities (Thailand) Co., Ltd. and Kim Eng Securities PCL. CIMB Thai Bank PCL and Krung Thai Bank PCL were designated as its selling agents and Krung Thai Asset Management PCL (KTAM) acting as its manager.
Mr Somchai Boonnamsiri, CEO of KTAM, noted that the success of the IPO was mainly due to loyalty to the internationally-recognised ‘Dusit’ brand, the great potential of the underlying investments and the perceived satisfactory rates of returns.
He added that investors’ confidence as to Dusit’s prominence in the hotel industry was a major reason for the achievement, as Dusit Management Co., Ltd., a 99.99%-held subsidiary of DTC, would become the lessee and manager of the hotels as well as an investor in the property fund. Another important reason was the three hotels’ locations in Phuket, Hua Hin and Chiang Mai, all of which are prime areas in terms of tourism growth prospects.
As for returns on investment, DTC as the assets owner offered annual minimum rental guarantee from the three hotels in the first four years at THB 381 million per annum, compared to the fund’s size of THB 4.094 billion. However, the actual investors’ return would be dependent upon the fund’s costs and expenses, including its set-up costs, operating costs and renovation expenses. In addition, DTC would secure a bank guarantee of THB 125 million per annum to ensure that the investors could enjoy dividend payouts at satisfactory rates. On average, freehold property funds offer the rates of returns of around 7% and leasehold property funds around 9% (Source: Stock Exchange of Thailand (SET)). With the freehold to leasehold investment ratio of 76:24, DTCPF would likely achieve the average rate of return at the same level as other property funds.
“All these factors contributed to the investors trust and the IPO’s success. KTAM is working on the process of listing DTCPF investment units on the SET and expects them to be become tradeable on the stock market within mid-January, 2011. DTCPF will likely be the first new IPO securities of 2011,” said Mr Somchai.
Distributed by Master Mind Communications Co., Ltd.
for Dusit Thani PCL
Attn: Orn-anong (“Fah”) Pattaravejkul
Tel. 0-2248-7967-8 # 117
Email:
[email protected] ,
[email protected]
Corporate PR & Communications Department, Dusit International
Chutimaporn Kasemsuk
Director, Corporate PR & Communications
Tel. 02200 9999 # 3320
Email:
[email protected] l www.dusit.com/pr