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The Straits Trading Company Limited : Far East Orchard looks to expand beyond Singapore Business Times

11/28/2012 | 02:08am US/Eastern



Far East Orchard looks to expand beyond S'pare lt inks non-binding MOU to buy Straits Trading's hospitality management biz

By MINDYTAN

IN A bid to expand its hospi­
tality business beyond Sin­
gapore, Far East Orchard
Rendezvous Studio Hotel Perth Centrai, Rendezvous Grand Hotel Melbourne and Rendezvous Hotel Perth.
STC will bave the right to subscribe up to 20 per cent of the share capitai of the enlarged hospitality management company of
Separately, Far East Hos­ pitality Trust (Far East H-Trust), Astor Properties, and STC have entered a non-binding MOU to ac­ quire STC's Rendezvous Grand Hotel Singapore and its retail component, Ren­ dezvous Gallery Singapore. ln addition, Far East Or­

Spreading wings :FEOrchard will also be looking to acquire a 50% interest in three of Straits Trading's hote[s in Australia. PHOTO: RENDEZVOUS GRAND HOTEL

Limited (FEOrchard) has entered into a non-binding memorandum of under­ standing with The Straits Trading Cornpany Limited (STC) to acquire STC's en­ tire hospitality manage­ ment business.
Under the deal, FEOr­ chard will also be looking to acquire a 50 per cent in­ terest in three of STC's ho­ tels in Australia, namely
FEOrchard.
Assuming the transac-· tions follow through, the ex­ paJ1ded portfolio will con­ sist of more than 30 hotels and service residences with more than 6,000 rooms un­ der management, with a presence across Australia, New Zealand, China, Malay­ sia and Singapore, said FE­ Orchard's group CEO and managing director, Lucas Chow.
ganization (FEO) is explor­
ing the proposed acquisi­
tion of the reversionary in­ terest for the remaining leasehold period in the property.
Conditional upon the completion of the transac­ tions, Far East H-Trust has also entered into a separate non-binding MOU with FEO to grant a master lease of the hotel component to the
sponsor as rnaster lessee

under a master lease agree­

ment.

Rendezvous G rand Ho­ tel Singapore is a 4.5 star hotel with 298 rooms. Ren­ dezvous Gallery Singapore, the hoteJ's revamped retail wing, has three levels of re­ tail space dedicated to din­ ing.

The proposed transac­ tions are not expected to have a materia!impact on
Far East Hospitality Trust's
financial performance for

the fiscal year ending Dee

31. 2012.

Straits Trading called for a halt in the trading of its shares last Saturday, over a week after it posted a Q3 net loss of $4.1 mil­ lion. For the nine months ended Sept 30, 2012, it made a net loss of $15.7 million.

It said the poor numbers
were due mainly to net loss­

es from its resources and hospitality operations. even though it earned a profit

.from its property opera­

tions.

Straits Trad.ing shares

closed at $3.20 on Friday.

Far East H-Trust ended yes­

terday down half a cent at

97.5 cents.

or STC makes generai offer for WBL Corp, Page 10
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