Frasers Hospitality Trust (FHT) was among the better managed hospitality trusts in the sector, with strong commitment from its sponsor. Back in 2016, Frasers Property (FPL) and the TCC Group, which together held some 63% in FHT, had supported the latter during an equity fundraising.
Yet, FPL is now offering minority investors 70 cents for their stapled securities to privatise FHT. The privatisation is to be implemented by a scheme of arrangement. FHT owns 14 properties in nine cities. Of these, six are serviced residences with the rest being hotels.
During a media briefing on June 13, Eu Chin Fen, CEO of FHT’s manager, acknowledged that she faced obstacles in growing distribution per security (DPS) and net asset value. “Muted growth in key markets is one of the reasons despite pursuing yield accretive acquisitions and AEIs,” says Eu.