Kuala Lumpur: IOI Properties Group Bhd’s (IOIPG) proposed complete acquisition of Scottsdale Properties Pte Ltd is considered a strategic and value-accretive decision, according to Hong Leong Investment Bank (HLIB).
According to BERNAMA News Agency, the investment bank noted that Scottsdale Properties, which holds the South Beach mixed-use development in Singapore, consists of a portfolio of prime assets. By moving from a 49.9 per cent joint venture stake to full ownership, IOIPG unlocks several key benefits. These include gaining full strategic control, enabling the company to independently shape asset enhancement strategies, make tenant mix decisions, and plan long-term capital improvements.
The acquisition also enhances the efficiency of resource sharing for IOIPG’s Singapore team in asset management, leasing, and operations. The South Beach assets are already generating income, providing an immediate boost to IOIPG’s earnings and recurring income stream.
IOIPG announced its plan to acquire the remaining 50.1 per cent stake in Scottsdale Properties from City Developments Ltd (CDL) for a total of S$834 million (RM2.75 billion). The purchase consideration is based on 50.1 per cent of the consolidated net assets of the Scottsdale group as of April 30, 2025. Upon completion of the transaction, IOIPG, which currently owns a 49.9 per cent stake, will assume full ownership of the South Beach development.
HLIB stated that post-acquisition, IOIPG will cement its status as one of the largest asset owners not only in Singapore but also as a growing regional real estate powerhouse. This diversified footprint provides defensive stability and growth opportunities, reinforcing IOIPG’s position as a compelling proxy for long-term property sector upside across the region.
The investment bank maintained its ‘Buy’ call with an unchanged target price of RM4.05, based on a 35 per cent discount to its estimated restated net asset value (RNAV) of RM6.24. As of 10.17 am, IOIPG’s share price was 1.0 sen higher at RM1.91, with 312,300 shares traded.