KUALA LUMPUR: Axis Real Estate Investment Trust (Axis-REIT) proposed to acquire the Tesco JB Hypermarket Complex for a total lump sum cash consideration of RM75.6 million from Bukit Indah (Johor) Sdn Bhd.

The latest acquisition will increase the assets under management to over RM1.2 billion, Axis-REIT said in a filing to Bursa Malaysia on Tuesday, Aug 24.

Axis-REIT trustee, OSK Trustees Bhd, has entered into a sale and purchase agreement with Bukit Indah Johor for the proposed acquisition.

The proposed acquisition will be funded by existing bank borrowings of Axis-REIT.

Axis REIT Managers Bhd, the management company of Axis-REIT, intends to utilise a debt facility of RM75.60 million from Axis-REIT's existing credit lines.

The proposed debt financing will increase Axis-REIT's gearing ratio to 39 per cent of audited total assets as at December 31, 2009, which is below the gearing limit of 50 per cent prescribed by the REIT guidelines.

Axis REIT Managers expects the proposed acquisition to contribute positively to the fund's earnings for the financial year ending December 31, 2010.

The proposed acquisition is expected to be completed on or before October 31, 2010.

The Tesco JB Hypermarket Complex is located within the main commercial precinct of Setia EcoCity in Taman Bukit Indah, a comprehensive mixed development project. -- Bernama
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