DBS Group Holdings Ltd. (DBSDF, DBSDY) agreed Sunday to acquire a 30 percent stake in Central Boulevard Development Pte. Ltd. or CBDPL, and its associated loan for about S$1.035 billion or $847 million, that gives DBS an unique opportunity to own a stake in its new global headquarters. The deal is expected to close before the end of 2012.
The company recently moved to Marina Bay Financial Centre or MBFC, Tower 3, and is now the anchor tenant at MBFC Tower 3. It is the largest corporate office in Singapore and houses the bank’s customer-facing units, an innovative flagship branch, a state-of-the art dealing room and a creative work environment for more than 4,800 DBS employees.
“The decision to acquire a stake in our new headquarters in MBFC Tower 3 enables us to better manage our occupancy costs in the long-term. The Marina Bay area is a location of choice for top financial institutions and businesses and the desirability and value of being housed here is only going to grow as Singapore strengthens its position as a leading Asian financial hub,” DBS CEO Piyush Gupta said in a statement.
MBFC Tower 3 is an award-winning 46-floor international Grade A office building with about 1.35 million sq ft of net lettable area. DBS currently occupies more than 600 thousand sq ft across 18 floors.
DBS will acquire the stake from Choicewide Group Ltd., a joint venture of Cheung Kong (Holdings) Ltd. and Hutchison Whampoa Ltd., along with its associated loan. DBS also agreed to a conditional put option to buy a remaining 3.33 percent stake and its associated loan from Choicewide for S$115 million.
If the Put Option is exercised, DBS will end up owning a one-third equity stake in CBDPL and hence in MBFC Tower 3.
Singapore-based DBS, Southeast Asia’s biggest bank, decided to move to MBFC Tower 3 as part of its regional strategic occupancy plan that was unveiled in 2007. It inaugurated its new Taiwan headquarters in Shin Kong Xinyi Financial Center at the heart of Taipei’s financial district last year.
DBS also relocated its support units to DBS Taipei Hub located in the Nei Hu Technology Park and inaugurated the DBS Bank Tower in Shanghai’s new financial district in 2010. The company’s Hong Kong operation was relocated to One Island East in Quarry Bay and the Millennium City 6 at Kwun Tong in 2009.
“As a leading bank in Asia, we are very pleased to be able to purchase a stake in our global headquarters, DBS Asia Central at MBFC Tower 3. This transaction demonstrates our firm commitment to further entrenching DBS’ leadership position in Singapore and the region,” DBS Chairman Peter Seah noted.
DBS is a market leader in Singapore with over four million customers and also has a growing presence in the three key Asian axes of growth, namely, Greater China, Southeast Asia and South Asia.
DBS’ primary operations are in Singapore and Hong Kong, two of Asia’s best regulated markets, which contributed 62 percent and 19 percent of net profit in 2011, respectively.
DBSDY closed Friday’s regular trading session at $48.55, up $0.60 or 1.25% on a volume of 14,860 shares.
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by RTT Staff Writer
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