SINGAPORE: Singapore property giants CapitaLand Investment (CLI) and Mapletree Investments are reportedly exploring a possible merger that could create one of Asia Pacific’s largest property firms, managing over US$150 billion (S$195 billion) in assets, according to Bloomberg News, citing a Dow Jones report on Monday.
However, the report, citing people familiar with the matter, said discussions are still at an early stage, and there is no certainty that the deal will materialise.
Both companies are linked to Singapore’s Temasek Holdings: CapitaLand Investment (CLI) is backed by Temasek, while Mapletree is wholly owned by it.
The potential merger is said to be part of Temasek-owned entities’ move to evaluate and reshape their portfolio companies to build larger and more competitive global entities, according to the report.
CLI told Bloomberg News that it remains focused on delivering long-term value for its shareholders and regularly reviews opportunities aligned with its strategic goals. It also acknowledged recent market speculation but said it does not comment on rumours or speculation.
A CLI spokesperson also told The Edge Singapore that should there be any matter requiring disclosures, the company will make the announcements in accordance with the Listing Manual of the SGX-ST.
An analyst covering CLI and the Mapletree-sponsored REITs said that while merger talks are not new, CLI’s S$200 billion assets under management (AUM) target and the need for a major share price boost could add urgency to pursuing the deal.
The analyst added that Mapletree, facing headwinds in overseas markets, may also be more open to the merger.
Morningstar analyst Xavier Lee said the merger’s possible candidates would be Mapletree Industrial Trust with CapitaLand Ascendas REIT, or CapitaLand Integrated Commercial Trust with Mapletree Pan Asia Commercial Trust, although he cautioned that the merger may face pushback from minority unitholders over valuation, DPU dilution, and portfolio composition concerns.
He also noted that the merger could create an international real estate platform with about S$180 billion in funds under management and unlock cost synergies similar to the 2019 CapitaLand–Ascendas-Singbridge merger. However, he said the benefit in asset class diversification may be limited, and Mapletree’s development arm might need restructuring to fit CLI’s asset-light fund management strategy.
Mapletree and Temasek have declined to comment on the merger. /TISG
Read also: Grab shuts down GoTo merger talks, says ‘no discussions’ or ‘definitive agreements’ between parties
