EC World REIT - DBS Research 2022-11-21: Throwing A Spanner In The Works; Downgrade to FULLY VALUED

EC World REIT - Throwing A Spanner In The Works

Published:
EC WORLD REIT (SGX:BWCU) | SGinvestors.ioEC WORLD REIT (SGX:BWCU)
  • It was previously believed that EC World REIT (SGX:BWCU) was on track to complete the divestments of Beigang Logistics Stage 1 and Chongxian Port Logistics by the end of this year. The divestments were necessary for EC World REIT to raise funds to repay at least 25% of its outstanding debt (~S$707.6m), and the preconditions set by its lenders before it would refinance EC World REIT’s loans due to expire on 30 April 2023.
  • - Read this at SGinvestors.io -
  • - Read this at SGinvestors.io -

What implications does this have?

  • See EC World REIT's Announcement dated 20 Nov 2022 – In its announcement, EC World REIT highlighted three potential courses of actions which are available to the REIT:
    1. Proceed with the divestments despite the Purchaser missing the long-stop date to procure the Transaction Financing Documents.
    2. Proceed with the divestments without entering any Transaction Financing.
    3. Terminate the proposed divestments with the Purchaser.
  • It is understood that Transaction Financing is not a condition necessary for the divestments, and failure to do so is also not a ground for termination of the proposed divestments. However, the failure to enter into the Transaction Financing by the long-stop date may affect the completion date of the proposed divestments and could be a potential delay to after 31 December 2022.
  • If the completion of the divestments is indeed delayed beyond 31 December 2022, it calls into question if EC World REIT will still be able to meet the conditions set by its lenders in order to refinance the loans due 30 April 2023.

Our thoughts on EC World REIT?

  • Read more at SGinvestors.io.




Above is the excerpt from report by DBS Group Research.
Clients of DBS may access the full report in PDF @ https://www.dbs.com/insightsdirect/.




Dale LAI DBS Group Research | Derek TAN DBS Research | https://www.dbs.com/insightsdirect/ 2022-11-21



Read also DBS's most recent report:
2023-02-24 EC World REIT - Navigating Refinancing Challenges.

Price targets by other brokers at EC World REIT Target Prices.

Listing of research reports at EC World REIT Analyst Reports.

Relevant links:
EC World REIT Share Price History,
EC World REIT Announcements,
EC World REIT Dividends & Corporate Actions,
EC World REIT News Articles





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