EPF is taking over CIMB Bank's stakes in funds that invest in Australian commercial office assets.
KUALA LUMPUR: The Employees Provident Fund Board (EPF) is buying CIMB Bank Bhd’s entire interest and units in two funds that invest in Australian commercial office assets for A$37.13mil (about RM123mil) in cash.
CIMB Group Holdings Bhd said in a statement to Bursa Malaysia that CIMB Bank, a 99.99% subsidiary of its unit CIMB Group Sdn Bhd, had signed an agreement with EPF to sell its entire 12.42% interest in CIMB-TrustCapital Office Fund 1 (AOF1) and 13.70% units in CIMB-TrustCapital Australia Office Fund 2 (AOF2).
The two funds are private equity, closed-end real estate funds registered in Singapore whose objective is to invest in Grade A and Grade B+ commercial office assets in the central business districts of Melbourne, Sydney and Canberra, with a secondary focus on Brisbane and Perth.
CIMB Group said the sale consideration was arrived at on a willing buyer and willing seller basis as well as taking into consideration the unaudited net assets value of AOF1 and AOF2 of A$171.4mil (RM568.7mil) and A$102.7mil (RM340.7mil) respectively as at June 30, 2016.
CIMB Group said the proposed disposals were in line with its aspirations to further streamline and focus on its core banking businesses.
The cash proceeds from the proposed disposals will be used to repay bank borrowings and for the group’s future working capital requirements.
EPF is deemed interested in the proposed disposals as it is a direct major shareholder of CIMB Group with a 13.98% stake.
CIMB Group chairman Datuk Seri Nazir Abdul Razak is deemed interested in the proposed disposals by virtue of him being a professional representative on the Investment Panel of EPF. Accordingly, he has abstained and will continue to abstain from deliberating and voting on the proposed Disposals at the relevant CIMB Group and CIMB Bank board meetings.
The proposed disposals are expected to be completed by end of this quarter.
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