What? Rich Malaysia’s SP Setia 5.5bn Funding for 20-years dead Battersea Power Station

A Malaysian property company is in discussions to take control of Battersea Power Station and fund a £5.5bn redevelopment of the site.

The Daily Telegraph understands that SP Setia has agreed terms with Irish group Real Estate Opportunities to take a majority stake in the landmark power station through acquiring the bank debt that is threatening to derail the redevelopment.


However, the lenders to the site, Ireland’s National Asset Management Agency and Lloyds, are understood to have serious concerns about the proposals.

 

sp-setia-battersea


The Far Eastern investor made a formal offer last week to the lending banks to buy their £300m of debt at around 85p in the pound, or £255m.


But the lenders, who are considering the bid and have the power to pull the plug on the Battersea project, are unhappy with the price. They are thought to be keen to explore other options for the power station, such as Roman Abramovich building a new stadium for Chelsea.

SP Setia is understood to have discussed the investment with Boris Johnson, the Mayor of London, but any deal must be approved by the banks. The £300m of debt backing the site matured on August 31 without being repaid by REO and this can be called in on demand.

 

REO has been seeking an investor for months to repay the debt and rescue its project to build 3,400 homes, a conference centre, 10m sq ft of offices and retail space at Battersea.


Under the tie-up with SP Setia, it would keep a minority stake in the special purpose vehicle that owns the power station and continue to manage the project.


Victor Hwang, who sold the power station to REO in 2006, could also take a minority stake. It is understood that some of the £170m he is owed by REO will be converted into equity with the rest paid off, although the details are still being ironed out.


Battersea Power Station has lain dormant since 1983 – when the power station was shut down.

A deal would mark the first foray into Europe for SP Setia, which is worth more than £1.4bn. The company is behind major development projects in Malaysia, Vietnam and Australia, where it is developing an apartment complex in Melbourne called Fulton Lane.


REO and the lenders declined to comment last night. SP Setia could not be reached.

 

from: Thedailytelegraph

Popular posts from this blog

Malaysia Inflation to start easing end-3Q or early 4Q2011

Image
Malaysia Inflation Rose To The Fastest Pace.
Inflation is still a major concern and we expect the upward pressure to stay in 3Q2011 coming from food & non-alcoholic and clothing/footwear in  view of the festive seasons. Impact from June’s electricity tariff hike is expected to continue. But the  upward inflation pressure can be contained from stronger RM/USD and high base comparison. Nonetheless, we expect inflation to start easing by end 3Q2011 or early 4Q2011. Meanwhile, with global uncertainties flared by euro debt crisis and slower US economic recovery lingering, it has forced AxJ policymakers to focus on growth as opposed to inflation. Rates hikes could be reaching its tail end. We expect BNM to accommodate further erosion in real returns by holding OPR at 3.00% to focus on growth. But possibilities for another 25bps hike in OPR remains, as it depends on inflation outlook. Likewise SRR hike will depend on liquidity inflow. If that happen, we expect another 50bps to 100bp…
Read more

Trump’s Win – Bark Worse Than Bite?

Image
While Asian equity markets may remain soft after the surprise of Donald Trump’s win in the US presidential election, we look forward to buying opportunities. Essentially, we do not expect significant economic repercussions on Malaysia’s economy or corporate earnings, save for the indirect impact on downward biases for the ringgit vs the US dollar and on interest rates. We highlight the trough prices of our conviction picks, as well as some buying opportunities.

WHAT’S NEW
• Near-term confidence pricked. Asian equity markets have swooned on knee-jerk reactions to Trump’s surprise win; the FBMKLCI eased 1%. Despite the major turnaround in US equities after Trump’s acceptance speech which promoted national unity and stressed on fiscal stimulus (the DJI futures initially fell by as much as 800 pts before the cash DJI remarkably recovered to positive territory), investment sentiment in Asia may remain damp and to be swayed by Trump’s anti-globalisation rhetoric. Nevertheless, we do not …
Read more

FBM KLCI Technical Outlook

Image
Stocks on Bursa Malaysia snapped a three-day losing streak to end higher last Friday on bargain hunting in selected heavyweights, which saw late fund buying of Tanaga Nasional and Malayan Banking. Bargain hunting by institutional funds supported the local market but further gains were limited by fears of a better-than-expected US third-quarter gross domestic product data which will be out later of the day. Asian stock markets were mixed as they were still affected by a flurry of major corporate earnings reports across the region and the declining oil prices. The ringgit weakened further against the US dollar at 4.1970/1020 from the 4.1810/1900 recorded on Thursday, tracking the performance of emerging Asian currencies. At close, the FBM KLCI settled at 1,670.27, up 1.24 points or 0.07%, from Thursday’s close of 1,669.03, after opening 0.58 of a point higher at 1,669.61 and moved between 1,666.97 and 1,671.72 throughout the day. On a weekly basis, the benchmark index gained 0.29 of a p…
Read more