There are no plans to take Australand private

August 2, 2008
There are no plans to take Australand private

CAPITALAND has no plans to take its Australian subsidiary Australand
private at present as it remains a core business, CapitaLand's group
president and CEO Liew Mun Leong said yesterday.

Australand chairman Lui Chong Chee said he expects CapitaLand's stake
in Australand to rise from the present 54 per cent to about 65 per
cent at most, assuming no retail investors participate in a recently
announced rights offer.

Australand, which is listed on the Australian and Singapore bourses,
has announced a one-for-one renounceable rights issue to raise
between A$302 million (S$386.5 million) and A$557 million to
strengthen its balance sheet.

Mr Liew said: 'They have done well for us for 11 consecutive years.
We're confident in the business and management of Australand and
we're taking up our pro-rata entitlement of A$302 million.'

Mr Liew also clarified that while Australand is keen on expanding
into Asia, it is eyeing the logistics and industrial property sectors
in the region, rather than residential and commercial properties,
where it could run into potential competition with CapitaLand itself.

'They are very strong in industrial and logistics and want to export
these services to Asia,' he said. 'We have the connections and
ability to source the land. They are not coming to Asia to build
apartments or build a Raffles City.'

Earlier this year, CapitaLand and Australand set up a 51:49 joint
venture to set up a pan-Asian development platform in the industrial
and logistics sectors.

Mr Lui said provisions for foreseeable losses taken by Australand in
H1 2008 were specifically for New South Wales, mainly Sydney. 'The
volume of (home) sales in Sydney has come down,' he said.

'But if you look at the rest of Australia - Perth, Melbourne and
Brisbane - the prices there are still quite stable.'

CapitaLand chief investment officer Kee Teck Koon highlighted that
Australand has been increasing its exposure to the commercial and
industrial property sectors, which offer more stable income, to
reduce its dependence on the residential sector.

CapitaLand's CFO Olivier Lim also indicated that CapitaLand may book
a negative goodwill gain from the Australand rights issue. The issue
is priced at 60 Australian cents per rights share - lower than
Australand's post-rights offer net tangible asset per share of A$1.13
to A$1.28.