SINGAPORE (Reuters) - Singapore's Oversea-Chinese Banking Corporation (OCBC) (SI:OCBC) and its insurance arm are selling their stakes in property firm United Engineers (SI:UTES) and a subsidiary to a group led by China's Yanlord Land Group and Perennial Real Estate Holdings (SI:PERE).
The deal, which was announced by the companies late on Thursday, values the two targets at roughly S$1.83 billion (1 billion pounds) in one of the biggest property takeover deals in the city state in recent years.
"As a key global financial centre, Singapore's real estate market continues to present a good value proposition for developers such as ourselves seeking to develop stable and recurring revenue streams," Zhong Sheng Jian, Chairman and CEO of Yanlord said in a joint statement with Perennial.
Yanlord, Perennial and other investors are buying out OCBC and its group companies' roughly one-third stake in United Engineers at S$2.6 per United Engineers' share, which will trigger a mandatory offer for the remaining shares.
The consortium is also buying out OCBC and its group firms' 29.9 percent stakes in property firm WBL Corp, a closely-held subsidiary of United Engineers.
United Engineers has property businesses, mainly in Singapore and China. Yanlord and Perennial also mainly own and manage sizeable portfolios in the same countries.
Credit Suisse (SIX:CSGN) is advising OCBC and its group firms on the strategic review of their stakes in United Engineers. United Overseas Bank is the financial adviser to the consortium.
An earlier attempt by OCBC and its group firms to sell their stakes in United Engineers had failed in 2014.