CapitaMalls Asia, which owns and operates shopping malls in the region, may sell shares in its Malaysian unit in an initial public offering depending on market conditions.

CapitaMalls Asia plans to sell 786.5 million shares and will retain as much as a 41.7% stake in the Malaysian trust after the sale, according to a statement to the Singapore exchange today. It did not say how much it hopes to raise from the planned IPO. The shopping mall operator has received the Malaysian regulator’s approval for the offering.

 

The unit of CapitaLand will decide if it will go ahead with the IPO, depending on a number of factors, including prevailing market conditions, according to the statement. At least 20 companies worldwide postponed or withdrew IPOs in May as a European debt crisis sent the Morgan Stanley Capital International World Index of developed- market stocks down 9.9% in the month.

 

“The planned listing of CapitaMalls Malaysia Trust is part of CapitaMalls Asia’s strategy to list in the home markets of our assets and to recycle capital for reinvestment,” said CapitaMalls Asia Chief Executive Officer Lim Beng Chee.

 

The Employees Provident Fund Board of Malaysia and Great Eastern Life Assurance (Malaysian) Bhd. have agreed to buy 11.4% of the IPO shares, CapitaMalls Asia said in the statement. The Malaysian fund and Great Eastern will pay 1.1 ringgit for each share or an unspecified institutional price, whichever is lower.

 

CapitaMalls Asia plans to sell its Malaysian properties, including Gurney Plaza and Sungei Wang Plaza, to the trust for 2.05 billion ringgit ($881.8 million), according to the statement. CapitaMalls Asia will have net proceeds of $187.4 million from the property sale.

 

CapitaMalls Asia rose 1.5% to close at $2.10 in Singapore trading yesterday.