OUE eyes swooping in on tier-3 cities in China

Including gateway cities in the US.

According to Phillip Securities, following the decision to call off the acquisition of F&N, the concern of overpaying is now removed in the firm's view. The relevant acquisition costs and fees are well covered by the break fee of $50mn provided by F&N.

The report said that going forward, the Executive Chairman Dr. Stephan Riady expresses his concern of slow growth in Singapore for the next 2 - 3 years, and indicates that the group is open to acquisition opportunities abroad such as tier-3 cities in China as well as gateway cities in the U.S., where the real estate market is on track for recovery.

"If higher capital outlay is required, the potential of listing its hotel assets onto a hospitality Reit will be revisited," Phillip Securities said.