Keppel DC REIT Announces Advanced Distribution and Preferential Offering Dates

Keppel DC REIT has made significant announcements that could influence its share price. The company has set the record date for its advanced distribution and preferential offering as 27 November 2024. This announcement is part of its broader equity fund-raising initiative aimed at raising approximately S\$1 billion.

Key Financial Details

Shareholders should note that the advanced distribution for existing units is estimated to range between 4.063 cents and 4.103 cents per unit. This distribution will include taxable income, tax-exempt income, and capital distribution components.

Important Dates for Shareholders

• Last date for units to be quoted on a “cum-distribution” basis: 25 November 2024.
• Record date for advanced distribution: 27 November 2024.
• Expected payment date for advanced distribution: 10 February 2025.
• Deadline for submission of tax declaration forms: 16 December 2024.

Distribution Tax Details

For tax purposes, the advanced distribution will comprise taxable income, tax-exempt income, and capital distribution. Notably, the tax-exempt income distribution is not subject to tax, while the capital distribution is considered a return of capital. However, taxable income distribution may have tax deducted at source under certain conditions.

Implications for New Unit Holders

New units issued through private placement and the preferential offering will not be entitled to the advanced distribution. However, they will be eligible for subsequent distributions. This differentiation is crucial for potential investors and existing shareholders to understand the financial benefits associated with their units.

Tax Considerations for Different Shareholder Categories

Various shareholder categories, including individuals, REIT ETFs, and foreign investors, have specific tax implications. Qualifying Unitholders, such as individuals and REIT ETFs, will receive a gross distribution and are generally exempt from immediate tax deductions. However, foreign non-individual investors will have a 10% tax deducted, and those not meeting specific criteria may face a 17% deduction.

Nominee shareholders and other joint holders will generally receive distributions net of a 17% tax unless they provide specific beneficiary details.

Conclusion

These developments, particularly the advanced distribution and the preferential offering, are significant for current and prospective shareholders. Investors should consider the timing of these events and the associated tax implications carefully, as they may have a material impact on the valuation and attractiveness of Keppel DC REIT’s units.

Disclaimer: This article is for informational purposes only and should not be considered as financial advice. Investors should perform their own research or consult with a financial advisor before making any investment decisions.