Companies may periodically undertake corporate actions that help to enhance value for their shareholders.
These actions may include mergers and acquisitions, divestments, or initiatives that help to unlock value and grow the business further.
Investors need to assess if these actions will result in a sustained improvement in the company’s fundamentals.
We would like to bring to your attention three companies that have recently undertaken corporate actions to unlock value for their shareholders.
Frasers Logistics & Commercial Trust (SGX: BUOU)
Frasers Logistics & Commercial Trust, or FLCT, is an industrial and commercial REIT with a portfolio of 114 properties worth around S$6.8 billion.
These properties are diversified across Singapore, Australia, the UK, Germany, and the Netherlands.
Earlier this month, FLCT announced the divestment of 357 Collins Street in Australia for A$195.3 million.
The consideration payable by the buyer after netting off fees and liabilities is around A$192.1 million, just a tad higher than the property’s independent valuation of A$191 million.
The rationale for this disposal is for the REIT to enhance its portfolio focus on logistics and industrial properties by making a strategic exit from the Melbourne CBD office market.
357 Collins Street saw its valuation remain at $191 million over the past year, reflecting challenging conditions in the Melbourne market.
Melbourne’s CBD office market is reeling from the impact of remote work, with an elevated occupancy level of 18% in the city.
Post-divestment, FLCT’s logistics & industrial weight will increase from the current 72.4% to 74.2%.
Portfolio occupancy will also rise from 93.9% to 95.2%, and the REIT’s weighted average lease expiry (WALE) will inch up from 4.6 years to 4.8 years.
Assuming the proceeds are used to reduce debt, FLCT’s gearing level will decline from 36.1% as of 31 March 2025 to 34.6%.
The divestment proceeds will enhance the REIT’s flexibility to pursue opportunities in the logistics and industrial space.
Completion is expected to take place by 30 September 2025.
Centurion Corporation (SGX: OU8)
Centurion is a provider of purpose-built worker accommodation (PBWA) assets in Singapore, Malaysia, and China, and also purpose-built student accommodation (PBSA) assets in the UK, Australia, the US, and China.
The group owns and manages a portfolio of 37 operational assets totalling 69,929 beds as of 31 March 2025.
The dormitory operator recently announced its intention to list a REIT named Centurion Accommodation REIT on the mainboard of Singapore Exchange.
This REIT will have an initial portfolio of 15 assets totalling 27,602 beds with an agreed property value of around S$2.1 billion.
By undertaking this value-unlocking exercise, management anticipates a considerable decline in its net leverage ratio.
With debt set to decrease, Centurion will have additional debt headroom for further growth.
Meanwhile, the group also unveiled a new premium student housing brand called EPIISOD.
The first EPIISOD property is under development in Macquarie Park in Australia with a capacity of more than 700 beds.
This property will be ready by February 2026 and will set a new standard for student living for both domestic and international students.
City Developments Limited (SGX: C09)
City Developments Limited, or CDL, is a global real estate company with a network spanning 168 locations in 29 countries and regions.
The group has developed over 53,000 homes and owns around 23 million square feet of gross floor area in residential, commercial, and hospitality properties.
Last month, CDL and IOI Properties Group Berhad (KLSE: 5249) entered into a share sale agreement whereby CDL will divest its 50.1% stake in South Beach Development to IOI.
South Beach is valued at S$2.75 billion, which represents a 3% premium over its latest valuation of S$2.67 billion as of 31 December 2024.
Based on CDL’s 50.1% proportionate stake, the estimated sale consideration is S$834.2 million.
Both CDL and IOI were long-term joint venture partners in the South Beach project since 2011.
This transaction should be completed by the third quarter of 2025, and IOI will gain full ownership of South Beach’s commercial components.
CDL’s move will help it to realise value from this property and is part of the blue-chip group’s efforts to accelerate capital recycling, reduce gearing, and redeploy capital.
Management is looking to unlock value across its diversified portfolio to pursue more growth opportunities.
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Disclosure: Royston Yang owns shares of Frasers Logistics & Commercial Trust.
