The closed-ended fund listed on Monday with a ticker symbol of TLGF, raising around Bt18.4bn ($600m). It is being managed by Krung Thai Asset Management, a privately-held asset manager based in Bangkok.
Tesco has had a presence in Thailand since 1998, when it began operating stores there under the Tesco Lotus name through a joint venture with a local company. It now has 782 stores in the country, employing more than 38,000 staff, according to Tesco’s website.
According to a statement on the website of the Stock Exchange of Thailand (SET), the Tesco Lotus Retail Growth Freehold and Leasehold Property Fund has invested in “17 high-quality Tesco Lotus hypermarket-anchored shopping malls in prime locations across all regions of Thailand, including Bangkok and the vicinity, tourist destinations and burgeoning cities”.
“In addition, the property fund has an established acquisition pipeline, with plans to inject additional assets into the fund every year.”
The statement quotes Chanitr Charnchainarong, SET’s executive vice president, as saying that the fund is the country’s largest property fund IPO since SET first began listing property funds in 2003, and that it had already attracted 11,341 investors.
Somchai Boonnamsiri, chief executive of Krung Thai Asset Management, said the fund had seen an “overwhelming response from institutional and retail investors during the subscription period, due to the number and quality of the assets in the fund and having Tesco Lotus as the fund’s property manager, utilising its 17 years of experience as a leading retailer and shopping mall operator in Thailand”.
“TLGF also has a clear growth plan, with a commitment to inject at least one to two assets into the fund every year,” he added.
The Tesco fund is described in its literature as being a “a closed-end specific property fund with indefinite life”, with a dividend policy to pay out “no more than four times a year at a rate of no less than 90% of net profit, excluding unrealised gains from auditing of property reappraisals of leases during the related accounting period”.
The fund’s top three shareholders after its IPO were said to be Ek-Chai Distribution System (Tesco Lotus, with 25%, Merrill Lynch Far East Ltd (21.62%) and the Thai Government Pension Fund (8.15%).
The TLGF fund’s prospectus is posted on the Thai Securities and Exchange Commission’s website, at www.sec.or.th.
