[SINGAPORE] The Straits Trading Company is divesting a freehold logistics facility in Incheon, South Korea, for 432 billion won (S$377.6 million) as part of its strategy to recycle capital from matured assets.
The mainboard-listed conglomerate announced on Friday (Jan 23) that Sky Logis Private Real Estate Investment Company (Sky) – a joint venture held under its subsidiary Straits Real Estate – has entered into a sale and purchase agreement with a major South Korean financial institution acting as a trustee.
Straits Trading holds an effective interest of approximately 47.3 per cent in Sky.
The consideration of 432 billion won is in line with the property’s independent valuation as at Dec 31, 2025.
Following the settlement of outstanding loans and transaction-related expenses, the group expects to receive net proceeds of approximately 95.4 billion won.
The company noted that on a project-level basis, the investment has generated an internal rate of return in excess of 20 per cent and an equity multiple of over three times in Singapore dollar terms.
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“With this divestment, we are realising the value of a matured asset and reallocating capital towards opportunities that support our long-term portfolio strategy,” Straits Trading executive chairman Chew Gek Khim said.
The property, Arenas Yeongjong Logistics Center, is a Grade A, six-storey ramp-up facility comprising approximately 191,000 square metres of dry warehouse and office lettable space.
Completed in January 2021, the facility is located about 8 km from the Incheon International Airport air cargo terminal.
Straits Trading noted that the divestment comes as the Greater Seoul Grade A logistics market moves towards a “more balanced supply-demand position”. The group described the transaction as an orderly divestment of an institutional-grade asset within a stabilising investment environment.
The group does not expect to recognise any material gain or loss on the disposal.
On a pro forma basis, assuming the disposal had been completed on Dec 31, 2024, the group’s net tangible assets per share would have decreased slightly to S$3.018, from S$3.057.
Had the disposal been completed on Jan 1, 2024, the group’s loss per share would have widened to S$0.041 from S$0.016.
Completion of the disposal is expected to take place on or around Jan 29.
Shares of Straits Trading ended flat at S$1.70 on Friday, before the announcement.
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