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Transcript of Sip1407001 p Vegetable Gf(1714) c(Clean)
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Accordia Golf Trust Management Pte. Ltd. (Registration Number: 201407957D), as thetrustee-manager (the Trustee-Manager) of Accordia Golf Trust (AG Trust), is makingan offering (the Offering) of 782,025,000 units representing undivided interests inAG Trust (the New Units) for subscription at the offering price (the Offering Price)which will be between S$0.97 per Unit (the Minimum Offering Price) and S$1.00 per
Unit (the Maximum Offering Price and the range between the Minimum Offering Priceand the Maximum Offering Price, the Offering Price Range). The Offering consists of(i) an international placement to investors, including institutional and other investors inSingapore (the Placement), (ii) an offering to the public in Singapore (the SingaporePublic Offering) and (iii) a public offering without listing in Japan (the Japanese PublicOffering). The minimum size of the Singapore Public Offering will be 41,163,000 Units.Investors subscribing for Units under the Singapore Public Offering will pay the MaximumOffering Price (subject to refund). There is one Unit in issue as at the date of this Prospectus.The total number of outstanding Units immediately after the completion of the Offering willbe 1,099,122,000 Units.
Daiwa Capital Markets Singapore Limited and Citigroup Global Markets Singapore Pte.Ltd. are the joint global coordinators, bookrunners, issue managers and underwriters forthe offering (together, the Joint Global Coordinators, Bookrunners, Issue Managers
and Underwriters or the Joint Bookrunners). The Offering is fully underwritten at theOffering Price by the Joint Bookrunners on the terms and subject to the conditions of the
Separate from the Offering, Accordia Golf Co., Ltd. (the Sponsor or Accordia Golf)will receive, as part settlement of the consideration for the acquisition of the Initial Portfolio, 317,096,999 Units (the Consideration Units).
No Units shall be al lotted or a llocated on the basis of this Prospectus later than six monthsafter the registration of this Prospectus by the Monetary Authority of Singapore (theAuthority or the MAS). Prior to the Offering, there has been no market for the Units.The offer of Units under this Prospectus will be by way of an initial public offering inSingapore. Application has been made to Singapore Exchange Securities Trading Limited (the
SGX-ST) for permission to list on the Main Board of the SGX-ST (i) all the Units inissue, (ii) all the New Units, (iii) all the Consideration Units and (iv) all the Units which maybe issued to the Trustee-Manager from time to time in full or part payment of the Trustee-Managers fees. Such permission will be granted when AG Trust has been admitted to the conditional upon issue of the Units and upon permission being granted by the SGX-ST to listand deal in and for quotation of the Units. In the event that such permission is not granted or ifthe Offering is not completed for any other reason, application monies will be returned in full, therefrom, and without any right or claim against any of AG Trust, the Trustee-Manager, theSponsor or the Joint Bookrunners.
AG Trust has received a letter of eligibility from the SGX-ST for the listing and quotation of(i) all the Units in issue, (ii) all the New Units, (iii) all the Consideration Units and (iv) all theUnits which may be issued to the Trustee-Manager from time to time in full or part paymentof the Trustee-Managers fees on the Main Board of the SGX-ST. AG Trusts eligibility tolist on the Main Board of the SGX-ST does not indicate the merits of the Offering, AG Trust,the Trustee-Manager, the Sponsor, the Joint Bookrunners or the Units. The SGX-ST assumesno responsibility for the correctness of any statements or opinions made or reports contained indication of the merits of the Offering, AG Trust, the Trustee-Manager, the Sponsor, the JointBookrunners or the Units.
AG Trust is a business trust (ReBusiness Trusts Act, Chapter 31A ocopy of this Prospectus has been lo2014 by the MAS. The MAS assumeRegistration of this Prospectus byFutures Act, Chapter 289 of Singapany other legal or regulatory requirin any way, considered the merits o
See Risk Factors for a discussion an investment in the Units. None ofJoint Bookrunners guarantees the pthe payment of a particular return
In connection with the Offering, CitigrManager) has been granted an ovethe Sponsor (the Unit Lender), exon behalf of the Stabilising Managerin part, on one or more occasions, t41,217,000 Units at the Offering Pricof Units in the Offering, solely to coapplicable laws and regulations, includate of commencement of trading in t
falling 30 days thereafter, or (ii) the dbehalf of the Stabilising Manager) hUnits representing not more than 5undertake stabilising actions. The exetotal number of Units in issue. (See Pfor further details.)
Prospective investors applying for UApplication Forms or Electronic AppConditions and Procedures for Appliwill have to pay the Maximum Offeramount or, as the case may be, the b claim against AG Trust, the Trustee-M
an application is rejected or acceptedany reason, or (iii) if the Offering PricPrice will be determined followingTrustee-Manager and the Joint Bookr(the Price Determination Date), whave no obligation whatsoever to agrany reason whatsoever, the Offering PTrustee-Manager, the Offering will noin one or more major Singapore newand Lianhe Zaobaonot later than two
Nothing in thi s Prospectus constituteother jurisdiction where it is unlawfregistered under the U.S. Securities Aand, accordingly, may not be offeredthat is exempt from, or not subject Act. The Units are being offered and and other investors in Singapore) in (Regulation S).
This document is important. If you
Offering of 782,025,000 Units (subject to the Over-Allotment Option)
Offering Price Range: S$0.97 to S$1.00 per Unit
Singapores first listed
business trust with
golf course assets
in Japan
ANNUAL DISTRIBUTION YIELD OF
9.1%(1)(including non-recurring items)
NORMALISED DISTRIBUTION YIELD OF7.0%(2)
(excluding non-recurring items)
FOR FORECAST YEAR 2015(3) (4)
Notes:
(1) Based on the illustrative annual DPU yield (including non-recurring items) and the Minimum Offering Price(2) B d th ill t ti li d DPU i ld ( l di i it ) d th Mi i Off i P i
PROSPECTUS DATED 21 JULY 2014 (REGISTERED WITH THE MONETARY AUTHORITY OF SINGAPORE ON 21 JULY
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Accordia Golf TrustPresents A Unique OpportunityTo Invest In Japans Golfing Market
About Accordia Golf Trust (AG Trust)
First business trust comprising investments in golf course assets in Japan to be listed on the SGX-ST
Initial Portfolio: 89(1)golf courses (including golf course related assets) located across Japan, valued at apJPY150,908 million(2)(approximately S$1,851 million)
86.4%(3)of the Initial Portfolio Golf Courses, are located in the three largest metropolitan areas in Japanbetter developed and well-maintained transport infrastructure and can be conveniently accessed by cust
Appraised Value(2) of the Initial Portfolio Golf Courses
AG Trust Portfolio
(2013/9/30)
Source: Sponsor, CBRE, Tanizawa
Three largest metropolitan areas account for 86.4% (3)
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
49.1% 25.0% 12.3% 13.6%
Greater Tokyo Region Greater Osaka Region
Other RegionsGreater Nagoya Region
S i G f C
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Key Investment Highlights and Competitive Stre
A unique opportunity to invest in the rst SGX-listed business trust with
an initial portfolio comprising golf course assets in Japan
POSITIVE MACRO-ECONOMIC TRENDS
Japans golf market has consistentlyshown a strong positive correlationwith the underlying condition of theeconomy
The demand for golf and consequentlyfor the courses owned by AG Trust,will benefit from the possible economicrecovery across Japan
Access and Exposure to theGolf Course Industry in Japan
Japan Nominal GDP (Historical and Forecast)
Yen(inTrillion)
570
550
530
510
490
470
4502008 2009 2010 2011 2012 2013 2014F 2
Nominal GDP Year-on-Year Change
RETURN OF GOLF TO THE O
HOST THE 2020 SUMMER OL
CHANGE IN DEMOGRAPHICS WITH MORE SENIOR CITIZENS
The increase in the number of senior golfers is anticipated to be a
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Brand Recognition and Play
Major Golf Courses Operato
0%
ACCORDIA GOLF
10%
20%
30%
40%
50%
60%
70%
59.8%
43.7%
31.4%
Brand Recognition Play Ex
Quality initial portfolio of golf courses to provide stable and attractive yi
A WELL-DIVERSIFIED AND BALANCED INITIAL PORTFOLIO WITH
LOW CUSTOMER CONCENTRATION RISK
No single golf course accounts for more than 6.0% of the aggregateappraised value of the Initial Portfolio as at 30 September 2013
LOCATED MAINLY IN THE THREE LARGEST METROPOLITAN AREAS
IN JAPAN WITH GOOD ACCESS TO DENSELY POPULATED CITIES
Generally able to attract more visitors and generate higher revenue
Better developed and well-maintained transport infrastructure andcan be conveniently accessed by customers
Weather conditions are more stable
Liquidity of assets will be higher in the event of a sale, as comparedto those located in regions outside of the three largest metropolitanareas in Japan
INITIAL PORTFOLIO OF INCOME-GENERATING STABILISED GOLF
COURSES AND GOLF COURSE RELATED ASSETS CAPABLE OF
GENERATING A STABLE AND ATTRACTIVE YIELD
Operated under the Accordia brand, which enjoys the highest brandrecognition among the three major golf course operators in Japan(4)
High utilisation rate of 75.9% on average in FY2013 The Accordia brand golf courses tend to be more resilient to
economic downturns given their relatively reasonable fees and costefficient operations
Japan Market
(2012)
AG Trust Portfolio(2014/3/3)
Number of Golf Courses
0% 10% 20%
Three large
39%
28%
Greater Tokyo Region Gre
OthGreater Nagoya Region
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Strong growth opportunities
STRONG EXTERNAL GROWTH OPPORTUNITIES BASED ON A
VISIBLE PIPELINE
Sponsors Portfolio post-IPO
The Sponsor has identified 26 golf courses held by the Sponsor andoperated under the Accordia brand which could potentially beoffered to AG Trust
The Sponsor has granted AG Trust:
(i) a right offi
rst refusal over any golf course business to be acquiredor disposed by the Sponsor which falls within AG Trustsinvestment mandate;
(ii) certain rights to initiate discussions with the Sponsor; and
(iii) certain undertakings to offer, and a call option over, the existingand future golf course business which are held by the Sponsorunder the Accordia brand
Sponsor has acquired as many as 59 golf courses between FY2006
Market Share of G
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Sponsorship by Japans Leading GolfCourse Operator
COMPREHENSIVE SUPPORT UNDER THE SPONSOR
SUPPORT AGREEMENT
AG Trust will leverage on the expertise, know-how andexperience of the Sponsor in golf course management, the
strong brand awareness of the Sponsor in the golf course
management industry, as well as established value chains
associated with golf courses held by the Sponsor
LEVERAGING ON THE SPONSORS STRONG NETWORK
OF RELATIONSHIPS WITH FINANCIAL INSTITUTIONS
AND AG TRUSTS CONSERVATIVE CAPITAL STRUCTURE
TO SUPPORT FUTURE GROWTH
ALIGNMENT OF INTEREST BETWEEN SPONSOR AND
UNITHOLDERS
The Sponsor will, immediately after the completion
of the Offering, be the largest Unitholder of AG Trust,
holding an aggregate of 28.85% of the Units upon listing
of AG Trust (assuming the Over-Allotment Option is not
exercised) or an aggregate of 25.10% of the Units upon
listing of AG Trust (assuming the Over-Allotment Option
is exercised fully), and intends to maintain its stake inAG Trust
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About the Sponsor
Accordia Golf Co., Ltd., is the leading golf course operator in Japan
Operates 135 golf courses and 26 driving ranges as at the LatestPracticable Date
Listed on the Tokyo Stock Exchange with a market capitalisationof approximately JPY136.5 billion or S$1.67 billion as at theLatest Practicable Date
About the Trustee-Manager
Accordia Golf Trust Management Pte. Ltd. is 49.0% held by theSponsor and 51.0% held by Daiwa Real Estate Asset ManagementCo. Ltd., a wholly-owned subsidiary of Daiwa Securities GroupInc.
The Trustee-Managers management team has significant
experience in Japans golf course industry and the golf course
management business
ASSET MANAGEMENT STRATEGY:
Increase revenue of the Initial Portfolio
Acquisition of new assets and divestment of under-performing assets
Optimising and improving operational efficiency and reducingoperating costs
RISK AND CAPITAL MANAGEMENT STRATEGY:
Assess risks relating to AG Trusts business
Optimise overall capital structure of AG Trust and its assets
(including the Initial Portfolio) Proactively manage overall financing costs
Utilise hedging techniques as appropriate to manage the foreignexchange exposure
ACQUISITION AND GROWTH STRATEGY
A right of first refusal and call option over the Sponsors pipeline ofgolf courses and driving ranges
Pursue selective acquisition opportunities to expand AG Trusts
business and portfolio of assets
To distribute 100.0% of AForecast Year 2015
First distribution will be and ending on 31 March
To distribute at least 9Income thereafter
ATTRACTIVE
ANNUAL DIS
9(includinNORMALISED DIST
(excludin
FOR FORE
0%Based on Maximum
Offering Price
2%
4%
6%
8%
10%
6.8%
8.8%
Distribution Yield for Forec
Notes:
(6) Illustrative DPU yields are cwhich is converted from JPS$, by the respective estimais calculated based on the uyields will vary accordinglysecondary market at a marke
(7) The 12-month period from 1 A
(8) Based on the illustrative annand the Minimum Offering P
(9) Based on the illustrative noitems) and the Minimum Offe
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Collaboration with Daiwa Securities Group, whichis highly experienced in asset management
Daiwa Real Estate Asset Management Co Ltd the real estate asset
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TABLE OF CONTENTS
NOTICE TO INVESTORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . .
MARKET AND INDUSTRY INFORMATION . . . . . . . . . . . . . . . . . . . . . . .
CERTAIN DEFINED TERMS AND CONVENTIONS . . . . . . . . . . . . . . . .
OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
INFORMATION CONCERNING THE UNITS . . . . . . . . . . . . . . . . . . . . . .
DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EXCHANGE RATE INFORMATION AND EXCHANGE CONTROLS . . . .
CAPITALISATION AND INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . . . .
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL C
RESULTS OF OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
UNAUDITED PRO FORMA FINANCIAL INFORMATION . . . . . . . . . . . .
PROFIT AND CASH FLOW FORECAST. . . . . . . . . . . . . . . . . . . . . . . . .
THE RESTRUCTURING EXERCISE . . . . . . . . . . . . . . . . . . . . . . . . . . . .
THE BUSINESS OF ACCORDIA GOLF TRUST . . . . . . . . . . . . . . . . . . .
OVERVIEW OF RELEVANT LAWS AND REGULATIONS IN JAPAN . . .
OVERVIEW OF THE GOLF COURSE INDUSTRY . . . . . . . . . . . . . . . . .
THE TRUSTEE-MANAGER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
THE SPONSOR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
CORPORATE GOVERNANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
INTERESTED PERSON TRANSACTIONS AND POTENTIAL C
INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
THE CONSTITUTION OF ACCORDIA GOLF TRUST. . . . . . . . . . . . . . .
CERTAIN AGREEMENTS RELATING TO ACCORDIA GOLF TRUST . .
TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PLAN OF DISTRIBUTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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APPENDIX A REPORTING ACCOUNTANTS REPORT ON THE
OF THE UNAUDITED PRO FORMA FINANCIAL
OF ACCORDIA GOLF TRUST AND ITS SUBSIDIA
FINANCIAL YEARS ENDED 31 MARCH 2011, 3
AND 31 MARCH 2013 AND FOR THE NINE-MO
ENDED 31 DECEMBER 2012 AND 31 DECEMB
APPENDIX B REPORTING ACCOUNTANTS REPORT ON TH
CASH FLOW FORECAST OF ACCORDIA GOLF
SUBSIDIARIES FOR THE FINANCIAL YEAR END
2015. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
APPENDIX C INDEPENDENT TAXATION REPORT . . . . . . . . .
APPENDIX D INDEPENDENT FINANCIAL ADVISER REPOR
INTERESTED PERSON TRANSACTIONS . . . . .
APPENDI X E I NDEPENDENT REAL ESTATE VALUATIO
REPORTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
APPENDIX F INDEPENDENT VALUATION SUMMARY LETTE
APPENDIX G INDEPENDENT REPORT ON THE GOLF COURS
APPENDIX H TERMS, CONDITIONS AND PROCEDURES FOR
FOR AND ACCEPTANCE OF THE UNITS IN SIN
APPENDIX I LIST OF PRESENT AND PAST PRINCIPAL DIRE
DIRECTORS AND EXECUTIVE OFFICERS . . . .
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NOTICE TO INVESTORS
No person is authorised to give any information or to make any represe
this Prospectus and any information or representation not so contained
as having been authorised by or on behalf of any of AG Trust, the Truste
or the Joint Bookrunners. If anyone provides you with different or incon
should not rely upon it.
Neither the delivery of this Prospectus nor any offer, subscription, sale or t
shall under any circumstances imply that the information herein is
subsequent to the date hereof or constitute a representation that there
development reasonably likely to involve a material adverse change in th
prospects of AG Trust, the Trustee-Manager or the Units since the date o
such changes occur and are material or required to be disclosed by law,
other regulatory or supervisory body or agency, the Trustee-Manager will
of the same to the SGX-ST and, if required, lodge and issue a supp
replacement document pursuant to Section 282D of the SFA and take im
with the said Section 282D. Investors should take notice of such announ
and upon release of such announcements and documents shall be deeme
changes.
None of AG Trust, the Trustee-Manager, the Sponsor or the Joint Boo
respective affiliates, directors, officers, employees, agents, representativ
any representation or undertaking to any subscriber of Units regar
investment by such subscriber under any securities, investment or simil
Prospectus is issued solely for the purpose of the Offering and prospecti
should not construe the contents of this Prospectus as legal, business,
Investors should be aware that they may be required to bear the financia
in the Units for an indefinite period of time. Investors should consult
advisers as to the legal, business, financial or tax and related aspects
Units.
By applying for the Units on the terms and subject to the conditions in
investor in the Units represents and warrants that, except as othe
Trustee-Manager and the Joint Bookrunners in writing, he is not (i) a
shareholder/Unitholder of AG Trust, the Trustee-Manager or the Sponsor
of the persons mentioned in (i), or (iii) a connected client of any Joint Bo
or distributor of the Units.
Copies of this Prospectus and the Application Forms may be obtained
availability, during office hours, from:
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sources believed to be reliable, but there can be no assurance as to the ac
of such information. While the Trustee-Manager has taken reasonable
information is extracted accurately and in its proper context, the Tr
independently verified any of the data from third-party sources or asc
economic assumptions relied upon therein.
The distribution of this Prospectus and the offering, subscription, sale o
certain jurisdictions may be restricted by law. AG Trust, the Trustee-Mana
Joint Bookrunners require persons into whose possession this Prosp
themselves about and to observe any such restrictions at their own expe
to any of AG Trust, the Trustee-Manager, the Sponsor or the Joint Bookr
does not constitute, and the Trustee-Manager, the Sponsor and the Jo
making, an offer of, or an invitation to subscribe for or purchase, any of the
in which such offer or invitation would be unlawful. Persons to whom a cop
been issued must not circulate it to any other person, reproduce or o
Prospectus or any information herein for any purpose whatsoever nor pe
to occur. For investors in member states of the European Economic Are
on the applicable disclosure requirements under the Alternative Inve
Directive 2011/61/EU will be provided together with the Prospectus.
The Units have not been, and will not be, registered under the U.S. Secuoffered or sold within the United States except in a transaction that is exe
to, the registration requirements of the U.S. Securities Act. The Units a
outside the United States in reliance on Regulation S.
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FORWARD-LOOKING STATEMENTS
Certain statements in this Prospectus constitute forward-looking statem
also contains forward-looking financial information in Profit and Ca
statements other than statements of historical facts included in this Pros
regarding the future financial position and results of AG Trust, the busin
objectives of the Trustee-Manager for future operations of AG Trust (inclu
and dividends) and statements on future changes in the industry, are forw
These forward-looking statements and financial information involve kno
uncertainties and other factors that may cause the actual results, perfor
of AG Trust, the Trustee-Manager or the Sponsor, or industry results, t
from any future results, performance or achievements expressed or im
looking statements and financial information. These forward-looking s
information are based on numerous assumptions regarding the Trustee
future business strategies and the environment in which AG Trust, the T
Sponsor will operate in the future. As these statements and financia
Trustee-Managers current views concerning future events, these st
information necessarily involve risks, uncertainties and assumptions. Ac
could differ materially from these forward-looking statements and fin
should not place any undue reliance on these forward-looking statemen
The important factors that could cause AG Trusts or the Trustee-M
performance or achievements to differ materially from those in the forward
financial information include, but are not limited to:
general global, regional and local economic conditions, particularly
regulatory developments and changes in the golf course industry;
implementation of new or changes in government regulations, includ
particularly in Japan;
the ability of the Trustee-Manager to successfully execute the bu
Trust;
changes in the need for capital and the availability of financing a
needs;
changes in interest rates or rates of inflation;
breaches of laws or regulations in the operation and managemen
future businesses and assets;
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foreign currency exchange rate fluctuations, including fluctuations
currencies that are used in the business of AG Trust;
legal, regulatory and other proceedings arising out of the operation
general global, regional and local political and social conditions and
changes to existing government policies in the jurisdictions where A
in the future, particularly Japan;
delays in obtaining business related approvals;
t iming of cash f lows;
the acquisition of new golf courses and associated capital expend
business trust expenses;
other factors beyond the control of AG Trust; and
other matters not yet known to AG Trust.
Additional factors that could cause actual results, performance or
materially include, but are not limited to, those discussed under Risk Fa
Flow Forecast, Distributions and The Business of Accordia Golf Trust
statements and financial information speak only as at the date of this Pr
Trustee-Manager, the Sponsor and the Joint Bookrunners expressly dis
undertaking to release publicly any updates of or revisions to any forwa
financial information contained herein to reflect any change in
expectations with regard thereto or any change in events, conditions or any such statement or information is based, subject to compliance with
regulations and/or the rules of the SGX-ST and/or any other relevant re
body or agency.
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MARKET AND INDUSTRY INFORMATIO
This Prospectus includes market and industry data and forecasts that h
internal surveys, reports and studies, where appropriate, as well as m
available information and industry publications. Industry publications,
generally state that the information they contain has been obtained from
reliable, but there can be no assurance as to the accuracy or complet
information. The Trustee-Manager has commissioned CBRE K.K. (CBRE
the global golf course industry for the purpose of inclusion in this Pro
(actual, estimated and forecast) relating to, among other things, dem
information. While the Trustee-Manager believes that the third part
contained in this Prospectus are reliable, the Trustee-Manager cannot en
information or data, and the Trustee-Manager, the Sponsor and the Joint
their affiliates or advisers have not independently verified this informatio
the underlying economic assumptions relied upon therein.
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CERTAIN DEFINED TERMS AND CONVENT
AG Trust will publish its financial statements in Japanese yen. In this Pr
S$, SGD, Singapore dollars or Singapore cents are to the lawful
references to U.S.$, U.S. dollars or U.S. cents are to the lawful curre
of America and references to , JPY or Japanese yen are to the law
For the readers convenience, certain Japanese yen amounts have been t
dollars. Unless otherwise indicated, such translations have been made
rate as at 16 June 2014, being the latest practicable date prior to the lodg
with the MAS (the Latest Practicable Date), of JPY81.52 = S$1.00. S
not be construed as representations that the Japanese yen or Singapore
to could have been, or could be, converted into Japanese yen or Singap
may be, at that rate indicated or any other rate or at all. See Exchang
Exchange Controls for further information regarding rates of exchange
yen and the Singapore dollar.
Unless otherwise specified, references to revenue from the golf courses
the Pro-Shop Business (as defined herein). See The Restructuring E
Restructuring 5. The Arrangement of the Pro-Shop Business for d
Business arrangement.
Capitalised terms used in this Prospectus have the meanings set out in
The forecast yields are calculated based on the Minimum Offering P
Offering Price. Such yields and yield growth will vary accordingly for inves
in the secondary market at a market price different from the Minimum
Maximum Offering Price.
Where appropriate, certain figures that appear in this Prospectus ha
discrepancies in the tables, graphs and charts included in this Prospe
amounts and totals thereof are due to rounding.
References to Appendix or Appendices are to the appendices set ou
references in this Prospectus to dates and times shall mean Singapore
otherwise specified.
In this Prospectus, references to SPC is to Accordia Golf Asset Godo
references to New SPC is to the same entity after the Merger (as de
Restructuring Exercise for further details.
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OVERVIEW
The following overview is qualified in its entirety by, and is subjec
information contained in or referred to elsewhere in this Prospectus. The
defined in this overview can be found in the Glossary or in the trust deed
Deed). A copy of the Trust Deed can be inspected at the registered office
which is located at 6 Shenton Way, #25-09 OUE Downtown 2, Singapor
Statements contained in this overview that are not historical facts m
statements. Such statements are based on certain assumptions and are
uncertainties and assumptions that could cause actual results, performa
AG Trust or the Trustee-Manager to differ materially from those forecaste
Forward-Looking Statements). Under no circumstances should the inclu
herein be regarded as a representation, warranty or prediction of the ac
assumptions by AG Trust, the Trustee-Manager, the Sponsor and the Jo
other person or that these results will be achieved or are likely to be ac
Units involves risks. Prospective investors are advised not to rely sole
should read this Prospectus in its entirety and, in particular, the s
information in this overview is extracted and Risk Factors to better und
AG Trusts businesses and risks.
INTRODUCTION TO ACCORDIA GOLF TRUST
AG Trust is the first business trust comprising investments in golf cours
listed on the SGX-ST. AG Trust is constituted with the principal investme
directly or indirectly, in the business of owning a portfolio of stabilised,
courses, driving ranges and golf course related assets worldwide, with a
For the avoidance of doubt, golf course related assets means assets w
golf courses and driving ranges and integral to the golf course businhouses and hotels. AG Trust will not be involved in the business of dev
developing or acquisition of hotels or hotel businesses which are not re
business.
The Trustee-Managers key objectives are to invest in golf courses, drivin
related assets that are able to generate long-term, stable cash flows, w
distributions to Unitholders and maximising long-term investment ret
generating long-term capital value growth through future acquisitions.
AG Trusts initial portfolio (the Initial Portfolio) will comprise 891 golf co
course related assets relating to such golf courses) located across Japa
Golf Courses), with 86.4%2 of the Initial Portfolio Golf Courses, based o
as at 30 September 2013 located in the three largest metropolitan area
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approximately JPY150,908 million (equivalent to approximately S$1
September 2013 by CBRE and Tanizawa (each an Independent Real
together, the Independent Real Estate Appraisers). (See Appendix
Estate Valuation Summary Reports.)
The Trustee-Manager will acquire the Initial Portfolio, through the acquis
at an acquisition price of S$945 million1, based on the valuation by Pricew
Ltd. (the Independent Valuer). This value is based on the valuation by
using the discounted cash flow method, being JPY81,982 million2 (equ
S$1,006 million), and is net of net debt (comprising intercompany loans an
the value attributable to membership interests in New SPC.
The acquisition price of the TK Interests is based on the valuation by thenot the valuations by the Independent Real Estate Appraisers as AG T
Interests, being the business of New SPC (which takes into consideratio
SPC and debt) and not the golf courses as real estate assets. In adopting
method, the results of the real estate appraisals were not applied.
In addition, as the real estate appraisals are based on the cash flows of th
have not been damages to the buildings or significant deterioration o
resulting from disasters such as earthquakes to have resulted in an adv
estate appraisals as at 30 September 2013, the Trustee-Manager is of thnot be any material differences to the real estate appraisals as at 30 S
update thereof is not necessary.
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The Three Largest Metropolitan Areas in Japa
Tokyo, Kanagawa,
Saitama, Gunma, I
and Tochigi
Total Population* 42,631
Total Golf Course
Visitors**28,306
Greater Tokyo Region
Osaka, Kyoto, Nara,Hyogo, Shiga and
Wakayama
Total Population* 20,845
Total Golf Course
Visitors**14,048
Greater Osaka Region
Aichi, Gifu and Mie
Total Population* 11,328
Total Golf Course
Visitors**9,386
Greater Nagoya Region
* As of December 31st, 2012ohtni(3102yraurbeFot2102hcraMmorfdoirepehT**
Prefecture
Prefecture
Prefecture
(See Appendix G Independent Report on the Golf Course Industry.)
The population in Japan is unevenly distributed, with the majority locateRegion, the Greater Nagoya Region and the Greater Osaka Region. Golf
densely populated areas, as compared to other regions in Japan, are g
more visitors and generate higher revenue. These areas have bette
maintained transport infrastructure and can be conveniently accessed by
weather conditions in these three largest metropolitan areas are gen
instance, shutdown periods due mainly to snowfalls are shorter).
(See Key Investment Highlights and Competitive Strengths (III) Quacourses to provide stable and attractive yield Portfolio located mai
metropolitan areas in Japan with good access from densely populated c
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The tables below set out certain information on the Initial Portfolio:
Summary of the Number of Golf Courses, Holes and Appraisal Value
by Region
RegionsNumber of
Courses %Number of
Holes %
m3
Three LargestMetropolitan Areas in
Japan
62 69.7 1,375 72.1
Greater Tokyo Region 35 39.3 781 41.0
Greater Osaka Region 15 16.9 369 19.4
Greater NagoyaRegion
12 13.5 225 11.8
Other Regions 27 30.3 531 27.9
Total 89 100 1,906 100
Note:
(1) Based on the real estate appraisals as at 30 September 2013 conducted by each o
Appraisers.
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Summary of the Revenue of the Initial Portfolio by Region
Regions
Revenue(1) (JPY/SGD million
FY2011 FY2012 FY2013
Nine-mperiod e
31 Dece
201
Three Largest
Metropolitan Areas
in Japan(2)
JPY45,140
SGD554
(79.9%)
JPY43,878
SGD538
(80.0%)
JPY43,752
SGD537
(79.9%)
JPY35
SGD
(79.6
Greater Tokyo
Region(2)JPY24,782
SGD304
(43.9%)
JPY23,771
SGD292
(43.3%)
JPY23,932
SGD294
(43.7%)
JPY19
SGD
(43.5
Greater Osaka
Region(2)JPY13,239
SGD162
(23.4%)
JPY12,919
SGD158
(23.5%)
JPY12,609
SGD155
(23.0%)
JPY10
SGD
(22.9
Greater Nagoya
Region(2)JPY7,119
SGD87
(12.6%)
JPY7,188
SGD88
(13.1%)
JPY7,211
SGD88
(13.2%)
JPY5
SGD
(13.2
Other Regions(2) JPY11,357
SGD139(20.1%)
JPY10,999
SGD135(20.0%)
JPY11,021
SGD135(20.1%)
JPY9
SGD(20.4
Sub total(2) JPY56,497
SGD693
(100%)
JPY54,877
SGD673
(100%)
JPY54,773
SGD672
(100%)
JPY44
SGD
(100
Adjustment(3) JPY(544)
SGD(7)
JPY(947)
SGD(12)
JPY(1,179)
SGD(15)
JPY(9
SGD(
Total(4) JPY55,953
SGD686
JPY53,930
SGD662
JPY53,594
SGD657
JPY43
SGD5
Notes:
(1) Revenue includes golf course revenue (playing fees (green fee and cart fee) andmembership revenue (annual membership fee, new membership fee and name tran
(2) Calculated by the sum of the revenues of individual golf courses in the regions.
(3) Adjustment for reconciliation with the unaudited pro forma financial information of A
(4) Based on the unaudited pro forma financial information of AG Trust.
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Summary of Net Operating Income of the Initial Portfolio by Region
Regions
NOI (2) (JPY/SGD million)
FY2011 FY2012 FY2013
Nine-m
period e
31 Dece
201
Three Largest
Metropolitan Areas
in Japan(3)
JPY15,863
SGD195
(83.9%)
JPY15,702
SGD193
(83.9%)
JPY15,737
SGD193
(83.2%)
JPY13
SGD
(83.0
Greater Tokyo
Region(3)JPY8,986
SGD110
(47.5%)
JPY8,731
SGD107
(46.6%)
JPY8,846
SGD109
(46.8%)
JPY7
SGD
(46.6
Greater Osaka
Region(3)JPY4,817
SGD59
(25.5%)
JPY4,703
SGD58
(25.1%)
JPY4,490
SGD55
(23.7%)
JPY3
SGD
(23.5
Greater Nagoya
Region(3)JPY2,060
SGD25
(10.9%)
JPY2,268
SGD28
(12.1%)
JPY2,401
SGD29
(12.7%)
JPY2
SGD
(13.0
Other Regions
(3)
JPY3,047SGD37
(16.1%)
JPY3,015SGD37
(16.1%)
JPY3,172SGD39
(16.8%)
JPY2SGD
(17.0
Sub total(3) JPY18,910
SGD232
(100%)
JPY18,717
SGD230
(100%)
JPY18,909
SGD232
(100%)
JPY16
SGD
(100
Adjustment(4) JPY(932)
SGD(11)
JPY(322)
SGD(4)
JPY(563)
SGD(7)
JPY(2
SGD
Total JPY17,978SGD221
JPY18,395SGD226
JPY18,346SGD225
JPY15SGD
Notes:
(1) Based on the unaudited pro forma financial information of AG Trust.
(2) NOI has been calculated by deducting merchandise and material expense, labexpenses from revenue.
(3) Calculated by the sum of the NOIs of individual golf courses in the regions.
(4) Adjustment for reconciliation with the unaudited pro forma financial information of A
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Summary of the Number of Visitors and Utilisation Rate of the Initi
Regions
Average Number of Annual Visitors
per 18 Holes Utilisa
FY2011 FY2012 FY2013
Nine-month
period ended
31 December
FY2011 FY2012 2012 2013
Three Largest
Metropolitan
Areas in Japan 54,151 54,257 55,998 44,846 44,644 76.3 75.7
Greater Tokyo
Region 53,327 52,638 55,068 44,103 43,166 75.3 73.7
Greater Osaka
Region 57,275 57,275 57,933 46,344 47,475 80.2 79.0
Greater Nagoya
Region 51,734 54,927 55,988 44,968 45,130 73.6 77.5
Other Regions 43,839 4 4,130 4 5,262 37,111 3 7,418 66.8 67.2
Total 51,278 51,435 53,007 42,691 42,631 73.8 73.5
Note:
(1) Utilisation rate is calculated based on the following formula for each region:
Utilisation rate = Total number of visitors per 18 holes/Total operating days 200 p
200 persons in this formula is a standardised maximum visitor capacity per 18 hoplayers per day) used by the Sponsor based on its experience in operating golf couan assumed maximum visitor capacity and the number of visitors in a day can excecertain Initial Portfolio Golf Courses can exceed 100% (see the utilisation rates of cein the Initial Portfolio by appraisal value as at 30 September 2013 under The Busine
Initial Portfolio Top 10 Golf Courses).While the util isation rate is not a measure of golf course operations commonTrustee-Manager believes that this measure reflects the level of efficiency in the opeof a golf course in a meaningful manner.
As shown in the table Summary of the Number of Visitors and UtilisPortfolio by Region, the golf courses located in the three largest metrhave consistently attracted a significantly higher number of visitors in thhigher utilisation rates compared to the golf courses in other regions. Ha
Portfolio Golf Courses located in the three largest metropolitan areas on ain turn, contributes to the stability of revenue of the Initial Portfolio.
AG Trust will invest in the Initial Portfolio through a tokumei kumiaistructuwhere AG Trust will enter into a Japanese tokumei kumiai arrangement (tokumei kumiaiinvestor (TK Investor) with the special purpose vehiclebe the tokumei kumiai operator (TK Operator) under the TK arrangem
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The Sponsor of AG Trust is Accordia Golf Co., Ltd., the leading golf cooperating 135 golf courses (of which 132 are owned by the Sponsor priorInterests) and 26 driving ranges as at the Latest Practicable Date. (See of Golf Course Operators as at March 2013 under Key Investment Hig
Strengths (IV) Strong growth opportunities (a) Strong external growthvisible pipeline with the Sponsor as the golf course operator with the larSponsor was incorporated in Japan in 1981 and is listed on the Tokyomarket capitalisation of approximately JPY136.5 billion or S$1.67 bPracticable Date. The Sponsor is in the business of providing integrated owning and operating golf courses, mainly in large metropolitan areas acentres in Japan and has a strong track record of acquiring and turningcourses with its expertise in golf course management and operational knInitial Portfolio Golf Courses were acquired by the Sponsor when the ven
proceedings/corporate re-organisations, which demonstrates the Sponsoand improve the revenue of these golf courses to a level and stabinvestment by AG Trust. Since its listing on the Tokyo Stock Exchange iits golf course and driving range operation business, acquiring as mbetween FY2006 and FY2013, and establishing its current position asoperator in Japan. (See The Sponsor for further details.)
The golf courses comprised in the Initial Portfolio will be operated underthe Sponsor pursuant to a golf course management agreement entered inand the SPC on 27 June 2014 (the Golf Course Management Agreebrand represents casual and enjoyable golfing, targeting a wide demplayers. The Accordia brand golf courses are distinguished from other gconsistent well-maintained course conditions and reasonable playing facilitated by the Sponsors expertise in golf course management and cThe Accordia brand is also increasingly well-accepted among female pof female visitors to the Initial Portfolio Golf Courses increasing, accountin12.1% of the total visitors to the Initial Portfolio Golf Courses in FY201
respectively.
1
Such positioning and targeting strategies of the Accorcontribute to their high utilisation rate as reflected in the table Summary oand Utilisation Rate of the Initial Portfolio by Region above. In addition, tcourses tend to be more resilient to economic downturns given their reand cost efficient operations.
THE INITIAL PORTFOLIO
The tables below summarise certain key information in relation to the In
to the appraisal value of the golf courses, each of the golf coursesIndependent Real Estate Appraiser, being either by CBRE or Tanizawa. A
value of each golf course in the tables below reflects the valuation of CB
be, Tanizawa:
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CBRE/Tanizawa
AppraisalValue
(asat
30Septembe
r2013)
(JPY/SGDm
illion)
Location
Area(m2)
Numberof
Holes
Inaugural
year1
Yearof
Acquisition
bythe
Sponsor
Distancefrom
ne
arest
highwayexit
JPY8,430
SGD10
3
Atsugi-Shi,
Kanagawa
1,258,046
27
1970
2005
Within10km
JPY6,650
SGD82
Atsugi-Shi,
Kanagawa
813,283
18
1981
2005
Within10km
JPY4,020
SGD49
Saitama-Shi,
Saitama
1,328,762
43
1963
2005
Within10km
JPY3,830
SGD47
Sodegaura-S
hi,
Chiba
856,861
27
1979
2005
Within10km
JPY3,830
SGD47
Inashiki-Shi,
Ibaraki
814,039
27
1962
2005
Within10km
JPY3,030
SGD37
Fujioka-Shi,
Gunma
1,216,014
36
1968
2008
Within10km
JPY2,930
SGD36
Ashigarakam
i-
Gun,Kanagawa
609,524
18
1973
2007
Within10km
JPY2,810
SGD34
Kisarazu-Shi,
Chiba
812,297
18
1997
2006
Within10km
J P Y 2 7 6 0
N
t S
h i
1 9 0 8 8 3 6
3 6
1 9 7 4
2 0 0 5
W i t h i
3 0 k
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CBRE/Tanizawa
AppraisalValue
(asat
30Septembe
r2013)
(JPY/SGDm
illion)
Location
Area(m2)
Numberof
Holes
Inaugural
year1
Yearof
Acquisition
bythe
Sponsor
Distancefrom
ne
arest
highwayexit
JPY2,260
SGD28
Katori-Shi,
Chiba
948,171
18
1984
2005
Within10km
JPY2,250
SGD28
Takasaki-Shi,
Gunma
1,047,405
27
1972
2008
Within10km
JPY2,190
SGD27
Mito-Shi,
Ibaraki
1,453,942
36
1966
2005
Within10km
JPY2,120
SGD26
Katori-Shi,
Chiba
759,508
18
1990
2005
Within10km
JPY2,120
SGD26
Tochigi-Shi,
Tochigi
569,047
18
1973
2005
Within10km
JPY1,970
SGD24
Tochigi-Shi,
Tochigi
797,090
27
1974
2005
Within20km
JPY1,710
SGD21
Kanra-Gun,
Gunma
1,156,822
18
1975
2007
Within10km
JPY1,500
SGD18
Tomioka-Shi,
Gunma
803,549
18
1986
2005
Within10km
JPY1,410
SGD17
Hiki-Gun,
Saitama
1,054,979
18
1994
2005
Within20km
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CBRE/Tanizawa
AppraisalValue
(asat
30Septembe
r2013)
(JPY/SGDm
illion)
Location
Area(m2)
Numberof
Holes
Inaugural
year1
Yearof
Acquisition
bythe
Sponsor
Distancefrom
ne
arest
highwayexit
JPY1,240
SGD15
Kamisu-Shi,
Ibaraki
836,671
18
1991
2008
Within20km
JPY1,130
SGD14
Fujioka-Shi,
Gunma
1,280,567
18
1988
2005
Within20km
JPY1,110
SGD14
Fujioka-Shi,
Gunma
1,668,200
18
1990
2005
Within20km
JPY1,100
SGD13
Kanuma-Shi,
Tochigi
984,175
27
1975
2007
Within20km
JPY1,010
SGD12
Kasama-Shi,
Ibaraki
1,262,015
18
1990
2005
Within20km
JPY99
8
SGD12
Isumi-Gun,
Chiba
1,242,026
18
1992
2005
Within40km
JPY68
8
SGD8
Kamogawa-Shi,
Chiba
889,599
18
1970
2005
Within40km
JPY67
1
SGD8
Chichibu-Gu
n,
Saitama
784,338
18
1975
2006
Within20km
JPY60
3
SGD7
Shibukawa-S
hi,
Gunma
1,516,533
27
1976
2005
Within20km
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CBRE/Tanizawa
Appraisal
Value
(asat
30September2013)
(JPY/SGDm
illion)
Location
Area(m2)
Numberof
Holes
Inaugural
year
Yearof
Acquisition
bythe
Sponsor
Dista
ncefrom
ne
arest
highwayexit
JPY7,040
SGD86
Otsu-Shi,
Shiga
2,051,043
45
1969
2009
Within10km
JPY4,640
SGD57
Izumisano-S
hi,
Osaka
1,343,189
27
1972
2005
Within10km
JPY4,430
SGD54
Katano-Shi,
Osaka
575,504
27
1968
2005
Within10km
JPY4,120
SGD51
Kizugawa-Shi,
Kyoto
1,206,331
36
1974
2005
Within20km
JPY2,900
SGD36
Takarazuka-Shi,
Hyogo
615,164
27
1960
2005
Within10km
JPY2,530
SGD31
Soraku-Gun,
Kyoto
1,031,318
45
1993
2005
Within20km
JPY2,030
SGD25
Ono-Shi,
Hyogo
743,267
18
1965
2005
Within10km
JPY1,940
SGD24
Kameoka-Sh
i,
Kyoto
694,053
18
1998
2005
Within20km
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CBRE/Tanizawa
Appraisal
Value
(asat
30September2013)
(JPY/SGDm
illion)
Location
Area(m2)
Numberof
Holes
Inaugural
year
Yearof
Acquisition
bythe
Sponsor
Dista
ncefrom
nearest
high
wayexit
JPY1,410
SGD17
Soraku-Gun,
Kyoto
1,145,952
18
1974
2005
With
in30km
JPY1,120
SGD14
Sennan-Gun
,
Osaka
206,026
18
1970
2005
With
in20km
JPY80
9
SGD10
Nara-Shi,
Nara
1,486,731
18
2001
2007
With
in20km
JPY73
5
SGD9
Kasai-Shi,
Hyogo
1,169,572
18
1987
2005
With
in10km
JPY60
9
SGD7
Himeji-Shi,
Hyogo
1,024,084
18
1996
2005
With
in20km
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CBRE/Tanizawa
Appraisal
Value
(asat
30September2013)
(JPY/SGDm
illion)
Location
Area(m2)
Numberof
Holes
Inaugural
year
Acquisition
bythe
Sponsor
Dista
ncefrom
nearest
high
wayexit
JPY2,4
20
SGD30
Yokkaichi-Shi,
Mie
661,573
18
1988
2009
With
in10km
JPY2,160
SGD26
Inabe-Shi,
Mie
1,278,719
27
1993
2005
With
in30km
JPY2,090
SGD26
Toki-Shi,Gifu
1,495,987
18
1990
2005
With
in20km
JPY1,960
SGD24
Toyokawa-Shi,
Aichi
1,635,889
18
1993
2009
With
in10km
JPY1,600
SGD20
Mizunami-Shi,
Gifu
1,079,483
18
1987
2008
With
in20km
JPY1,440
SGD18
Tsu-Shi,Mie
869,786
18
1992
2009
With
in10km
JPY1,400
SGD17
Tsu-Shi,Mie
592,471
18
1991
2009
With
in10km
JPY1,380
SGD17
Kameyama-Shi,
Mie
704,063
18
1996
2005
With
in10km
JPY1,180
S G D 1 4
Kani-Gun,G
ifu
1,058,367
18
1992
2008
With
in10km
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CBRE/Tan
izawa
Appraisal
Value
(asat
30September2013)
(JPY/SGDm
illion)
Location
Area(m2)
Numberof
Holes
Inaugural
year
Yearof
Acquisition
bythe
Sponsor
Dista
ncefrom
nearest
high
wayexit
JPY3,0
50
SGD3
7
Mishima-Shi,
Shizuoka
1,069,886
18
1988
2005
With
in20km
JPY2,1
20
SGD2
6
Numazu-Shi,
Shizuoka
873,030
18
1969
2005
With
in10km
JPY1,7
10
SGD2
1
Fuji-Shi,
Shizuoka
722,429
18
1973
2008
With
in20km
JPY1,3
40
SGD1
6
Itoshima-Shi,
Fukuoka
952,335
18
1974
2007
With
in10km
JPY1,2
30
SGD1
5
Sanyoonoda
-Shi,
Yamaguchi
1,863,554
36
1980
2005
With
in10km
JPY96
8
SGD1
2
Hioki-Shi,
Kagoshima
1,454,590
18
1989
2005
With
in20km
JPY96
1
SGD1
2
Mihara-Shi,
Hiroshima
1,168,476
18
1977
2008
With
in20km
JPY84
6
SGD1
0
Santo-Gun,
Niigata
489,212
18
1974
2005
With
in20km
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CBRE/Tan
izawa
Appraisal
Value
(asat
30September2013)
(JPY/SGDm
illion)
Location
Area(m2)
N
umberof
Holes
Inaugural
year
Yearof
Acquisition
bythe
Sponsor
Dista
ncefrom
nearest
high
wayexit
JPY62
0
SGD8
Takehara-Sh
i,
Hiroshima
1,116,606
18
1994
2005
With
in20km
JPY59
7
SGD7
Kurokawa-G
un,
Miyagi
1,377,510
18
1998
2006
With
in20km
JPY54
8
SGD7
Izu-Shi,
Shizuoka
596,199
18
1961
2005
With
in40km
JPY46
4
SGD6
Miyazaki-Sh
i,
Miyazaki
816,506
18
1991
2005
With
in20km
JPY44
8
SGD5
Sanjo-Shi,
Niigata
675,500
18
1976
2005
With
in20km
JPY42
5
SGD5
Tagawa-Gun
,
Fukuoka
1,072,749
18
1976
2005
With
in40km
JPY40
3
SGD5
Kikuchi-Shi,
Kumamoto
1,573,608
18
1979
2005
With
in30km
JPY39
0
SGD5
Saikai-Shi,
Nagasaki
1,016,537
18
1994
2005
With
in30km
JPY36
5
S G D 5
Hita-Shi,
O i t a
677,450
18
1967
2005
With
in20km
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CBRE/Tan
izawa
Appraisal
Value
(asat
30September2013)
(JPY/SGDm
illion)
Location
Area(m2)
N
umberof
Holes
Inaugural
year
Yearof
Acquisition
bythe
Sponsor
Dista
ncefrom
nearest
high
wayexit
JPY28
9
SGD4
Miyakonojo-
Shi,
Miyazaki
682,127
18
1992
2007
With
in10km
JPY27
6
SGD3
Kurokawa-G
un,
Miyagi
1,211,083
18
1992
2005
With
in20km
JPY26
2
SGD3
Higashiokita
ma-
Gun,Yamag
ata
885,800
18
1985
2005
With
in60km
JPY11
0
SGD1
Saikai-Shi,
Nagasaki
994,455
18
1991
2007
With
in20km
JPY49
SGD1
Kanazawa-S
hi,
Ishikawa
1,311,095
18
1993
2007
With
in10km
cilitiesatthegolf
course.
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KEY STRATEGIES OF THE TRUSTEE-MANAGER
The Trustee-Manager intends to invest in golf courses, driving ranges
assets worldwide, with an initial focus in golf courses and golf course relat
that can generate long-term, stable cash flows, while paying conUnitholders and maximising long-term investment returns of Unitholders
capital value growth through future acquisitions. The Trustee-Manager b
outlook of the golf course industry in Japan provides AG Trust with the op
returns of its portfolio of assets through a combination of the following s
Asset Management Strategy:
The Trustee-Manager aims to benefit from the following strategies with New SPC, the operator of the golf course business, so as
revenue, profitability and cash flows. New SPC aims to maximise r
cash flows of the golf course business under the TK arrangement by
Sponsor and the Asset Manager.
Increase revenue of the Initial Portfolio
Acquisition of new assets and divestment of under-performing
Optimising and improving operational efficiency and reducing
Risk and Capital Management Strategy:
Assessing risks relating to AG Trusts business
Optimise overall capital structure of AG Trust and its assePortfolio)
Proactively manage overall financing costs
Utilise hedging techniques as appropriate to manage the fore
Acquisition and Growth Strategy:
A right of first refusal and call option over the Sponsors pipe
driving ranges
Pursue selective acquisition opportunities to expand AG Trust
of assets
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At present, the US contains the largest number of golf courses in the worldJapan. These are also the most mature golf markets and have the most In the mid 1980s to late 1990s, golf experienced strong growth in developstarted to penetrate the affluent and middle income classes. This encour
many courses to capture demand from affluent baby boomers in anticipatopportunities as they reached retirement age. However, from 2008 to 2crisis and corresponding recession in many countries impeded further grand resulted in a contraction in demand. A reduction in leisure spending, played, coupled with increased competition amongst courses, triggeracquisitions and closures in the industry. Nevertheless, as the world ec2012 and 2013, the total number of rounds played rebounded and therethat golf markets in these countries were nearing the end of their contra
Golf Market in Japan
The golf market in Japan has undergone substantial change since its pIndustry consolidation has been occurring for over a decade and a nucourses have closed or have been converted to alternative uses. Thincreasingly a two-tier market with experienced golf courses operatorsynergising between operations and related businesses. Well managproximity to large urban areas such as Tokyo, Kanagawa, Osaka, Aichihave proven relatively resilient to market downturns and remain popular
hand, smaller operators that are resistant to change and golf courses incontinued to struggle. Although the number of transactions has decdivestments and acquisitions remain commonplace, and experienced goseek opportunities to acquire golf courses in good locations.
The performance of the golf market in Japan has historically been positiof the greater economy, and it has benefited from the recent economic impeconomic stimulus introduced by the government under Prime Minis
sentiment, exports, inbound tourism, corporate profits and stock marincreased since 2012. During the same period, the number of visitors to revenue and golf equipment sales have rebounded as underlying economThe positive correlation between golf demand and the underlying economcourse industry will benefit if recent initiatives succeed in freeing the ec
Demographic and cultural developments also bode well for the market. Tgolfers are presently over 40 years old. As golfers approach retiremenleisure time and disposable income, they are able to play more rounds of
why the frequency of play has been rising in recent years. Additionally, th2016 and 2020 Olympics is expected to enhance the image of golf as afurther catalysts for the industry to grow.
At present, female and junior golfers represent a small percentage of theand are underdeveloped segments of the market. If potential demand c
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(II) Access and exposure to the golf course industry in Japan
(a) Stability and growth potential of golf course industry in J
Japan is the third largest golf market in the world with over 2,40driving ranges as at February 2013. The number of golfers in
7.9 million as at the end of 2012 and golf is one of the recrea
Japan. Demand for golf courses has remained stable in recent
Number of Golfers in Japan).
8.98.3
9.5 9.6
8.1
0
2
4
6
8
10
12
2006 2007 2008 2009 2010
(million)Number of Golfers in Japan
(See Appendix G Independent Report on the Golf Course I
The emergence of Japanese professional golfers such as Ai
and Hideki Matsuyama, has fostered the Japanese publics
increased the appeal of the game in recent years, and during
has been an increase in the number of rounds played per gol
of Rounds Played per Golfer).
8.2 8.3 8.0
9.9
10.7
9.6 9.5
10.9
9,000
9,500
10,000
n10,000s)
Number of Rounds Played per Golfer
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In comparison with other mature golf markets, Japan has relati
the size of its golf playing population. Both the average numb
average total number of players (both member and non-mem
higher in Japan than in other countries. (See graphs Numb
Golf Course1
and Golf Player per Golf Course in Mature Coudemand for and utilisation of golf courses in Japan has remain
time.
0
500
1,000
1,500
2,000
JAPAN UK INDIA
MembershipPerGolfCou
rse
Number of Memberships Per Golf Cours
0
500
1,000
1,500
2,000
2,500
3,000
3,500
JAPAN USA UK CANA
GolfPlayerPerGolfCourse
Golf Player Per Golf Course in Mature Countri
(See Appendix G Independent Report on the Golf Course I
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Japanese baby boomers are now in their sixties and approachthey will have more time in retirement to play golf, demand fromis expected to be a driver of growth in future. Additionally, tOlympic games in 2016 is expected not only to improve the appbut also to increase world-wide coverage and sponsorship of gobe hosting the 2020 Summer Olympics which will further enhaand golf courses in Japan. This added exposure comes at angrowing number of women and young people are showing an icould help promote the growth of these new and undeveloped
Furthermore, the depreciation of the yen, the deregulation of vthe proposal to legalise casinos in Japan and the Olympic Gagrowth in tourism and an increase in golf course usage in Jap
The Trustee-Manager believes that the stability and growth poindustry in Japan is likely to lead to sustainable and stable diswith potential for growth.
(See Appendix G, Independent Report on the Golf Course In
(b) High barriers to entry in the golf course market
Land cost remains high in Japan and a typical golf course will rof land due to the hilly nature of golf course land in Japan. Acurrent cost of constructing an average golf course in Japan isto US$60.0 million (approximately JPY5 billion to JPY6 billiodecreasing membership prices, it is generally difficult to recoveof memberships and other golf course revenues. Accordinglyare transacted at below replacement value in Japan1, andevelopment has taken place in the past few years.
The market competition, maintenance expertise and economiealso made it increasingly hard for potential new entrants to succin recent years. In addition, there is an increasing number ofremote areas which are being closed or converted to other usesolar power plants, contributing to a decrease in the total numbe(see graph Number of Golf Courses). As such, golf courses advantages are better positioned to attract visitors and capture
2,457 2,453 2,446 2,442 2,442 2,445 2,432
2,000
2,500
3,000
Number of Golf Courses
2,442
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(III) Quality initial portfolio of golf courses to provide stable and a
(a) A well-diversified and balanced initial portfolio with low c
risk
The Initial Portfolio is well-diversified geographically across Jap
seven regions in Japan. Based on the total number of Initial Po
geographical breakdown of the Initial Portfolio is as follows
region1, 5.6% in the Hokkaido and Tohoku regions2, 7.9% in
Koshinetsu regions3, 13.5% in the Kyushu and Okinawa region
Nagoya Region5, 16.9% in the Greater Osaka Region6 and 39.
Region7. The majority of the Initial Portfolio Golf Courses are w
the three largest metropolitan areas in Japan (see (III)(b) bemanner, catering to the customers in these highly populated a
diversification also minimises the impact on the overall perfor
any adverse weather conditions occurring in a single location, p
changes in regulations or regulatory policies by a particular loc
demand in a particular region and any other localised adverse
single Initial Portfolio Golf Course accounts for more than
appraised values as at 30 September 2013 of the Initial Portf
As AG Trusts portfolio grows, it is anticipated that AG Trus
opportunities to invest in golf courses, driving ranges and gol
whether located in Japan or elsewhere globally which fit within
of stabilised, income-generating golf courses, driving ranges
assets.
(b) Portfolio located mainly in the three largest metropolita
good access from densely populated cities
The population in Japan is unevenly distributed, with the major
Tokyo Region, the Greater Nagoya Region and the Greater O
the three largest metropolitan areas in Japan. Golf courses l
populated areas, as compared to other regions, are genera
visitors and generate higher revenue. These areas have
well-maintained transport infrastructures and can be con
customers. In addition, weather conditions are more stable periods due mainly to snowfalls are shorter). The above factor
to attract more users and allow for higher and more stable rev
of these assets will be higher in the event of a sale, as comp
regions outside of the three largest metropolitan areas in Jap
69 7% f th I iti l P tf li G lf C l t d i th G
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69.7% of the Initial Portfolio Golf Courses are located in the Gr
Greater Nagoya Region and the Greater Osaka Region. This p
as compared to the geographical distribution of golf courses
Portfolio consists of a greater proportion of golf courses in thes
which are more easily accessible (see graph Location combetween overall Japan and Initial Portfolio constituents).
39.3%
28.1%
16.9%
14.4%
13.5%
9.4% 48
0% 20% 40% 60%
Initial portfolio
Japan
(2012)
Location Comparison of golf coursesbetween overall Japan and Initial portfolio consti
Greater Tokyo Region Greater Osaka Region Greater Nagoya Re
(See Appendix G Independent Report on the Golf Course I
Further, AG Trust aims for stable growth in revenue of the Initia
and accordingly, the three largest metropolitan areas are cons
regions. Based on the appraised values of the Initial PortfoliSeptember 2013, 86.4% of the golf courses are located in the th
areas in Japan.
(c) Initial portfolio of income-generating stabilised golf cou
related assets capable of generating a steady and attracti
The Initial Portfolio Golf Courses will be operated under the
Accordia brand represents casual and enjoyable golfdemographic range of golf players. Accordia brand golf co
from other golf courses by, inter alia, consistent well-maintaine
reasonable playing fees and meal charges. Based on a surve
Accordia brands recognition among the golf players in Japan
f (S
Brand Recognition and Play Experience Survey of
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Brand Recognition and Play Experience Survey of
Golf Course Operators In Japan
59.8%51.4%
3
43.7%
29.2%31.4%
19.3%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
Accordia Golf PGM Group
Brand recognition Play experience Play experience
Note: Based on the internet survey of 2,000 people who played golf in the mMACROMILL, INC in 9/2013. The survey was commissioned by the Sponon the trend of golfers. MACROMILL, INC has not provided its consentof the SFA, to the inclusion of the information cited and attributed to it iis not liable for such information under Sections 282N and 282O of tTrustee-Manager, the Sponsor and the Joint Bookrunners have taken rea
the information is reproduced in its proper form and context and thaaccurately and fairly, none of AG Trust, the Trustee-Manager, the Sponany other party has conducted an independent review of this informationcontents of the relevant information.
Also, the loyalty card programme for Accordia brand golf coenhance customer attraction and retention. Such positioning anAccordia brand golf courses, together with the customer lcontribute to the high utilisation rate of the Initial Portfolio Go
average in FY2013. In addition, the Accordia brand golf coursesto economic downturns given their relatively reasonable fees and
By virtue of the strong brand recognition in the industry and brand to attract customers, the Initial Portfolio Golf Courses harevenue and income. Further, the Initial Portfolio Golf Courseand are distinguishable from competing golf courses. See for of the Otsu Country Club Course under The Business of AcInitial Portfolio Top 10 Golf Courses.
AG Trusts initial portfolio of income-generating stabilised coupled with the strategic locations of the geographically well-dGolf Courses, is expected to deliver a stable distribution iattractive yield to Unitholders.
(S P fit d C h Fl F t d th i
There are 2 405 golf courses in Japan as at 28 February 201
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There are 2,405 golf courses in Japan as at 28 February 201
12.3% are affiliated to major golf course operators1. Many g
backing of established franchises such as major golf
disadvantaged when competing with golf courses under the sup
These unfranchised operators may find it necessary to sell thas part of a legal liquidation procedure due to poor busines
voluntary basis, especially the golf courses held by large co
business (See table Market Share of Golf Course Operators
graph Disposal and Legal Liquidation of Golf Courses Each Y
Market Share of Golf Course Operators as at M
Company NameNo. of
Golf CoursesNoH
Accordia Golf 133(1) 2
PGM Group 122 2
Orix Group 40
Ichikawa Landscape GardeningGroup 34
Seibu Group 28
Tokyu Group 26
Cherry Golf Group 23
Unimat Group 19
Taiheyo Club 17
Chateraise 14
Resort Trust 13
Kamori Kanko 12
RESOL 12
Tokyo Tatemono (JGolf) 12
GCE Group 11
Hotel Monterey Group 11
Akechi Club & Boso Country ClubGroup 10
JGM Golf Group 10
Dailysha Group 10
Daiwa House 10
Disposal and Legal Liquidation of Golf Courses Eac
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Disposal and Legal Liquidation of Golf Courses Eac
0
20
40
60
80
100
120
140
160
180
200
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2 0 0 7
Disposal and Legal Liquidation of Golf Course
Normal Sale Bankruptcy-relate
(See Appendix G Independent Report on the Golf Course I
Having capitalised on these takeover opportunities, the Sponsoas 59 golf courses between FY2006 and FY2013, and is expec
courses in future:
Total Number of Golf Courses Owned by the Sponsor as
FY2006 FY2007 FY2008 FY2009 FY2010 FY201
91 103 125 125 128 132
Number of Golf Courses Newly Acquired by the Sponso
FY2006 FY2007 FY2008 FY2009 FY2010 FY201
0 12 22 5 7 4
Number of Golf Courses Sold by the Sponsor in:
FY2006 FY2007 FY2008 FY2009 FY2010 FY201
0 0 0 5 4 0
S f
Pipeline Golf Courses held by Sponsor (under the Accor
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Pipeline Golf Courses held by Sponsor (under the Accor
No. Name of Golf Course Locatio
Greater Tokyo Region1. Saitama Golf Club Iruma-G
2. Toride Sakuragaoka Golf Club Toride-S
3. Minami Ichihara Golf Club Ichihara
4. Boshu Country Club Tateyam
5 Kanto Kokusai Country Club Haga-G
6. Suifu Golf Club Hitachio7. Kazusa Country Club Ichihara
8. Kasumidai Country Club Inashiki
Greater Osaka Region
9. Yamanohara Golf Club Kawanis
10. Yashiro Tojo Golf Club Kato-Sh
11. Sakai Country Club Sakai-S12. Inagawa Kokusai Country Club Kawabe
13. Inagawa Green Country Club Kawabe
14. Loveam Shirahama Golf Club Nishimu
Greater Nagoya Region
15. Suzukanomori Golf Club Suzuka-
Other Regions
16. Hiroshima Asa Golf Club Hiroshim
17. Kaho Golf Club Iizuka-S
18. Fukui Country Club Sakai-S
19. Echizen Country Club Arawa-S
20. Otsuki Garden Golf Club Tsuru-S
21. Chitose Country Club Chitose
22. Liberal Hills Golf Club Futaba-
23. Palm Hills Golf Resort Club Itoman-
24. Onahama Ocean Hotel & G olf Club I waki-Sh
sustain damage from the nuclear power plant accident or
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g p p
Earthquake in 2011, revenues had suffered as a result of th
reputation of the region, for which the Sponsor has receiv
TEPCO. While it was not affected by the nuclear power plant
Club also sustained earthquake damage at the ninth hole, as ais currently operating only 18 of its 27 holes.
In any case, the Trustee-Manager will only acquire stabilise
Sponsors pipeline that meet its investment objectives.
(b) Internal growth opportunities
The Sponsor, as the leading golf course operator in Japan, hasby offering optimum prices to golf course users through optim
along with other novel services related to golfing and tied to b
Sponsor has achieved enhanced profitability of the golf course
by turning them around based on its experience in the managem
further details, see The Sponsor.
Pursuant to the Golf Course Management Agreement under
provide golf course management and other services in respeGolf Courses, AG Trust will be in a position to fully capit
strengths, such as its network, customer base and existing str
revenue of the golf courses in the Initial Portfolio manage
Sponsor. The Sponsor will, going forward, also further expand
the growing demand brought about by macro economic fac
recovery of Japan, and the expectation of an increase in
generation, an increase in tourism and an increase in the go
about by golf returning as an Olympic sport (see Access a
course industry in Japan Stability and growth potential of
Japan). Further strengthening of earning power of the Initial P
through the implementation of various streamlining measure
cost optimisation and administrative rationalisation.
Specifically, the Sponsor intends to focus on golf courses hel
higher operational costs relative to sales in order to improve p
also intends to utilise the following measures to achieve suc
costs:
(i) Promotion of self-service and automation;
(ii) Turning labour charges into variable costs through outsou
(V) Sponsors comprehensive support under the Sponsor Support
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The Sponsor is the leading golf course operator in Japan, with golf
Sponsor accounting for approximately 5.5% of Japans golf course
table Market Share of Golf Course operators as at March 2013), heavily populated three largest metropolitan areas or major regional
number of golf course visitors to the Sponsors golf courses was 7.8
to March 2013.
AG Trust will outsource the management and operation of the golf c
Trust to the Sponsor, the leading golf course operator in Japan, the
Sponsors business experience and know-how.
This relationship between the Sponsor and AG Trust will be comp
Trust will primarily invest in golf courses and golf course related as
focuses on the operation and acquisition of the golf courses and go
which may not have stabilised in profitability. The Trustee-Manage
will be able to leverage on the Sponsors established network of rela
knowledge in the Japan golf course industry to strengthen AG Trus
AG Trust will leverage on the expertise, know-how and experienc
course management, the strong brand awareness of the Spon
management industry, as well as established value chains associate
by the Sponsor. To this end, AG Trust has entered into the Sponsor
the Sponsor, which consolidates the support from the Sponsor in v
which are set out below:
(a) A support framework to enhance profits through organic
The operation of the Initial Portfolio is delegated to the Spon
Course Management Agreement, under which the Sponsor sh
expertise and know-how to enhance the profitability of golf cou
in its operations.
(b) A support framework to grow AG Trusts asset portfo
acquisition opportunities
To demonstrate its support towards the growth of AG Trust
granted a right of first refusal, a right to initiate discussions, cert
and a call option to New SPC or AG Trust, subject to certain term
provides New SPC or, as the case may be, AG Trust with acc
opportunities and a visible pipeline of golf courses and golf co
(d) AG Trust will leverage on the Sponsors network of relat
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institutions
AG Trust will leverage on the Sponsors existing relationships
institutions to seek favourable terms for its financing activrefinancing of existing loans, risk hedging and financing the
courses.
(VI) Sponsors strong network of relationships with financial instit
conservative capital structure to support future growth
In order to facilitate the steady growth of, as well as efficient and sta
under management, AG Trust, New SPC and the special purposenewly formed for the purpose of further acquisitions of golf course
listing of AG Trust on the SGX-ST (the Listing) may borrow fund
purposes of, inter alia, future acquisition of assets, funding future
debt repayments.
In order to finance part of the purchase consideration of the Initia
scheduled to borrow funds from nine major banks in Japan at a re
which is possible due to the favourable relationships between the S
financial institutions.
As at Listing Date, AG Trust is expected to have gross borrowing
(equivalent to approximately S$558 million) with an LTV1 ratio
Manager believes that AG Trusts conservative capital structure su
operations and cash flows, and provides a buffer against potent
financing market, while positioning AG Trust to effectively pursue
attractive terms.
In addition, with the current capital structure of an LTV ratio of 30.2%
headroom to utilise further debt financing for the acquisition of addit
than relying only on equity fund raising. This provides AG Trust wit
to capitalise on acquisition opportunities in an expedient manner sh
arise.
(VII) Alignment of interest between Sponsor and Unitholders
The Sponsor intends to support and grow AG Trust over the long-
immediately following the completion of the Offering, be the larges
aggregate of 28.85% of the Units upon listing of AG Trust (assum
Option is not exercised) or an aggregate of 25.10% of the Units u
period commencing from the day immediately following the First L
d f lli h f h Li i D ( h S d L k
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date falling 12 months after the Listing Date (the Second Lock-u
50% of the Lock-up Units, subject to certain exceptions.
With regard to the fees payable to the Trustee-Manager in accordanAG Trust will employ a performance fee structure for part of the ma
linked to the turnover and net operating income of the Initial Portfolio
Sponsor an incentive to maximise the equity value of AG Trust.
The fees to be paid to the Sponsor under the Golf Course Managem
a corporate fee of JPY2,750,000 per 18 holes1 and JPY1,000,000 p
month2, an integrated purchasing system3 usage fee of JPY15,000 p
a variable fee that consists of 3.0% of turnover, 5.0% of increment60.0% of admission fees received during the relevant month from n
(VIII) Collaboration with Daiwa Securities Group, which is highly
management
Daiwa Real Estate Asset Management Co. Ltd., the real estate as
Daiwa Securities Group, will be appointed as the asset manager. T
strong governance framework and has a proven track record and ext
management of listed REITs, having been engaged as a real e
J-REITs since 2005 (see table Outstanding Balance of Entrusted A
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
2009 2010 2011 2012
(million JPY)Outstanding Balance of Entrusted Assets
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ager
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OLFTRUST
relationshipb
etween,
interalia,AG
Trust,theTrustee-Ma
nager,theSponsor,th
eTKOperator,theAssetMana
ingDate.
Unitholding
(morethan25.1%)
DaiwaS
ecuritiesGroupInc.
Acco
rdiaGolfCo.,Ltd.
(Sponsor/GolfCourseManager)
Trustee-Manager(7)
(TKInvestor)
Japan
Singapore
100.0%
51.0%s
hareholding
49.0%s
hareholding
Sharewarrants(6)
T K C o n t r i b u t i o n
u n d e r T K A g r e e m e n t
Actso
nbehalfof
Unitho
lders
DaiwaPIPartnersCo.Ltd.
DaiwaRea
lEstateAsset
Managem
entCo.Ltd.(
3)
(AssetMana
ger/TM
Partner)
AccordiaGolf
Trust
Golfcourseholdingcompany
(N
ewSPC/TKOperator)
100.0%(9)
Fees
Subordinated
Loan
Outsourcingof
Pro-Shop
Business
(5)
Distributions
GolfCourseManagement
Agreement(Adviceonmanagemen
t
de
cisions,administrativesupport,
op
eration/managementofgolf
co
urses,ROFR,CallOption)
ndent
ythe
Trust
fthe
ywill
onsor
ourse
aiwa
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eldbythememb
ersofISH,whichwillconsis
toftwocertifiedpublicacco
untantswhoarememberso
fTKAO(asdefinedbelow),
anindepen
viceproviderwithnominalequitycontributiontoachievebankruptcyrem
oteness.
eceiveanyfees
fromAGTrust.Instead,as
theTKOperatorwillbeinje
ctingitsowncash(fundedusingthesubordinatedloan
grantedby
ratorsOwnFun
ding))intotheTKBusines
s(amountingtoapproximately0.6
%
oftheaggregateo
f(i)theTKContributionma
debyAGT
storand(ii)theTKOperatorsOwnFunding),itwillbeentitledtorece
ivereturnofdistributionsfrom
theTKBusinessequa