Countries: United States
The chairman of Westfield Holdings Limited, Mr Frank Lowy, today announced the completion of the listing of Westfield America, Inc. (WEA) on the New York Stock Exchange. The company issued 18 million shares to a range of institutional and individual investors at US$15 per share. In addition, Dutch investors subscribed for US$27 million preference shares. Trading in the new shares will commence on the New York Stock Exchange on Friday, May 16, 1997 (New York time).
As a result, approximately US$300 million of new capital has been raised, allowing WEA to increase its earnings per share over time through a planned expansion and redevelopment program. In the first instance, funds will be used to acquire an economic interest in Garden State Plaza, one of the top 5 centres in the US, and to acquire other centres with substantial redevelopment potential.
The Initial Public Offering was lead-managed by Merrill Lynch & Co., and co-managed by Furman Selz, Goldman Sachs & Co., Morgan Stanley & Co., Prudential-Bache and Smith Barney.
Westfield Holdings has resolved that unitholders in Westfield America Trust (WAT), which has a 52.3% interest in WEA, should not be disadvantaged as a result of the issue price of WEA, which was set to ensure strong institutional support following listing. Westfield Holdings plans to take steps, details of which will be announced in the near future, to ensure that unitholders in WAT (other than Westfield Holdings and members of the Lowy family) receive for no further consideration an additional three units for every 100 units held. This is designed to preserve the net asset backing at the time of the issue for those unitholders.
The opportunities to grow the US business as a result of the listing on the New York Stock Exchange will benefit WEA, WAT (as the major shareholder in WEA) and Westfield Holdings.
Westfield Holdings has reaffirmed the distribution amounts set out in the 1996 WAT prospectus will be met.
A summary of key transactions of the listing is attached.
Summary of key transactions
The float involved Westfield America, Inc. (WEA) issuing 18 million shares at US$15. This issue was listed on the NYSE for trading from 16 May, New York time.
Following allotment, Westfield Holdings and the Lowy family have agreed to purchase from Merrill Lynch 2.3 million and 600,000 shares respectively at the issue price.
At the same time as the US listing, Westfield America, Inc. will:
- issue US$27 million preference shares to Dutch investor ABP,
- subscribe A$19.6 million for 9.8 million Westfield Holdings Limited options over new shares.
As a consequence of the listing, Westfield America Trust is to:
- issue for a price of approximately US$2.1 million special options to ABP to subscribe for approximately 36 million units in Westfield America Trust, each exercisable by the year 2012.
- receive at a cost of approximately US$2.6 million warrants to acquire 2,089,552 shares in Westfield America, Inc. exercisable by the year 2017.
At the time of listing, one of the US investors in Westfield America, Inc. exercised an option to acquire 32,479,700 units in Westfield America Trust in exchange for 1,623,985 shares in Westfield America, Inc. These new units were placed by SBC Warburg with a large group of Australian institutions. This will increase the issued capital of Westfield America Trust from 789,882,678 units to 822,362,378.
Westfield Group