RCR and RLC 'consummate' 3rd asset swap
![RCR and RLC 'consummate' 3rd asset swap](https://media.philstar.com/photos/2021/11/17/stock-commentarymb_2021-11-17_08-59-59.jpg)
RL Commercial REIT [RCR 5.63 unch; 251% avgVol] [link] disclosed that deeds of assignment had been signed between RCR and its sponsor, Robinsons Land [RLC 15.20, up 0.5%; 77% avgVol], for 13 commercial assets valued at P34 billion after the RCR board obtained shareholder approval the previous day. RCR purchased the assets from RLC using a property-for-share swap transaction, which will transfer nearly 5 billion primary common shares of RCR to RLC at a P6.80/share valuation. The transaction will increase RLC’s stake in RCR from 50.05% to 65.90% once the deal is approved by the SEC. RCR has said that the income from the properties will accrue to RCR shareholders as of April 1, 2024.
MB BOTTOM-LINE: According to my calculations, even though RLC’s April sale of RCR shares was in anticipation of a much smaller injection (P25B) than the one shareholders actually got (P34B), the April sale will still be sufficient to keep RCR’s post-swap public float above the REIT Law minimum of 33.33% at around 34.1%. Make no mistake, this is a bold move, and the retroactive income accrual is a nice cherry on top for RCR shareholders. The income from the properties will factor into RCR’s Q2/24 distributable income for the purposes of this upcoming dividend declaration. As a side note, not sure why EDGE is showing RCR at a 33.86% public float. Unless I’m missing something, the April transaction should have put this new value at 49.95%.
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