TIDMIHR
RNS Number : 1233W
Impact Healthcare REIT PLC
15 April 2019
THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT IS RESTRICTED AND
IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION IN THE UNITED
STATES OF AMERICA, ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA
(OTHER THAN THE UNITED KINGDOM, THE REPUBLIC OF IRELAND OR THE
NETHERLANDS), CANADA, AUSTRALIA, JAPAN OR THE REPUBLIC OF SOUTH
AFRICA.
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014. Upon the publication of
this Announcement, this inside information is now considered to be
in the public domain.
15 April 2019
IMPACT HEALTHCARE REIT PLC
(the "Company" or, together with its subsidiaries, the
"Group")
PROPOSED PLACING OF ORDINARY SHARES
The board of Directors of Impact Healthcare REIT plc (ticker:
IHR) (the "Board"), the real estate investment trust which provides
investors with exposure to a diversified portfolio of UK healthcare
real estate assets, in particular residential care homes, is
pleased to announce its intention to raise at least GBP25 million
by way of a placing (the "Placing") of new ordinary shares ("New
Ordinary Shares") pursuant to the Company's placing programme as
set out in the prospectus published by the Company on 11 February
2019 (the "Prospectus").
As at 31 March 2019, the Company had successfully invested all
its equity capital and had drawn or committed GBP37 million of its
GBP75 million in available debt facilities. The net proceeds of the
Placing will enable the Company to pay down its revolving debt
facilities and to fund new investments in line with its investment
policy and to create further value for its shareholders.
The Company will announce its unaudited net asset value ("NAV")
as at 31 March 2019 on or around 1 May 2019. The Company today
announces that the unaudited estimated NAV per Ordinary Share as at
31 March 2019 ("eNAV") was approximately 104 pence.
The issue price per New Ordinary Share under the Placing will be
106 pence (the "Issue Price"), which represents a discount of 2.3
per cent. to the closing price per Ordinary Share on 12 April 2019
of 108.5 pence and a premium of approximately 1.9 per cent. to the
eNAV.
The New Ordinary Shares will be eligible to receive all future
dividends and distributions declared, made or paid, including the
target dividend payable by the Company for the quarter to 31 March
2019 which is expected to be announced in due course.
The New Ordinary Shares will rank pari passu with the existing
Ordinary Shares in the capital of the Company.
The Board reserves the right to increase the size of the
Placing, subject to, inter alia, investor demand, the near-term
availability of attractive investment opportunities, and the
projected financial position of the Company after the
fundraising.
The Placing shall commence immediately following this
announcement and is expected to close at 2:00pm on 9 May 2019. The
results of the Placing are expected to be announced on 10 May
2019.
Applications will be made to the Financial Conduct Authority for
admission of the New Ordinary Shares to the premium segment of the
Official List and to the London Stock Exchange for admission to
trading of the New Ordinary Shares on its main market for listed
securities ("Admission"). It is expected that Admission will become
effective on 15 May 2019 and that dealings in the New Ordinary
Shares will commence at that time.
Winterflood Securities Limited ("Winterflood") and RBC Capital
Markets are acting for the Company in relation to the Placing.
Highlights
The Company has a strong pipeline of potential acquisitions in
various stage of negotiations with a total value in excess of
GBP400 million, as detailed in the Prospectus. More
specifically:
-- Impact Health Partners LLP, the Company's Investment Manager,
is in exclusive or final negotiations and at an advanced stage of
due diligence on six transactions, each of which could close in the
second quarter of 2019. Together these transactions would enable
the Company to deploy in excess of GBP60 million and add 12 new
assets with two new tenants to its current portfolio.
-- The Fund Manager is in negotiations on a further five
transactions into which the Company could deploy up to GBP128
million of capital in the third quarter of 2019.
-- Each of these transactions, which will be subject to Board
approval, is expected to be accretive to earnings and to improve
further the diversification of the Company's portfolio.
-- The leases to be put be place on all potential new
acquisitions will be consistent with those on the Company's
existing portfolio, with fixed terms of not less then 20 years and
an annual, upwards-only inflation adjustment with a floor of 2% and
a cap of 4%.
-- In addition, the Company's Fund Manager has identified
organic growth opportunities to add over 500 beds to the Company's
existing portfolio where planning permission has been approved or
is in progress. Up to 31 December 2018, capital has been committed
(and in the case of Parkville II, a deferred payment mechanism
employed) to add 188 beds (of the 500+ beds identified).
Rupert Barclay, Chairman of Impact Healthcare REIT plc,
said:
"The Company and its Fund Manager are continuing to exercise
robust capital discipline to deliver value at the point of
acquisition or investment and this share placing will enable the
Company to capitalise on its identified pipeline of attractive
near-term investment opportunities, which is expected to generate
value for shareholders.
The Group has a secure and growing income stream from its
diversified portfolio of high-quality homes let on long,
inflation-linked leases to a growing number of capable tenants with
whom we have strong relationships. Our tenants offer an essential
regulated service and provide high quality care, which helps to
underpin our new progressive dividend policy and total return
target, helping to ensure that the Company stands in good stead in
an uncertain economic and political environment.
Each of these opportunities identified by the Company's Fund
Manager are expected to be earnings accretive and further diversify
the Company's portfolio."
Background to the Placing
Since IPO in March 2017, the Company has built a diversified
portfolio of 73 care homes across the United Kingdom. As at 31
December 2018, the Company's contracted rent roll was GBP17.8
million and its weighted average unexpired lease term was 19.5
years. In the year to 31 December 2018, it made a profit before tax
of GBP16.5 million. 100% of the Company's leases have an annual,
upwards-only inflation adjustment at RPI with a floor of 2% and a
cap of 4%.
Since inception, the Company has paid seven quarterly dividends
of 1.5 pence per share. The total of 6.0 pence per share paid in
2018 was 108% covered by the Company's EPRA earnings per share of
6.47 pence for 2018. In February 2019, the Company introduced a new
progressive dividend policy in which it aims to increase the
dividend paid each year by an amount equal to rent increases
received in the prior financial year. It has set a target to pay a
dividend of 6.17 pence per share in 2019.
The Company's targeted net shareholder return (combining NAV
growth and dividends) is 9% per annum. The capital growth element
of this return will be delivered largely from annual,
inflation-linked rent increases and the impact of active asset
management, rather than relying on yield compression.
The Company has established a good track record of sourcing
high-quality assets in advance of its fund raises and efficiently
executing acquisitions afterwards, thereby minimising the
potentially negative effect of cash drag on its financial
returns.
Benefits of the issue
The Directors believe that the continued growth of the Company's
portfolio via the Placing will:
-- allow the Company to capitalise further on its identified
pipeline of attractive near-term investment opportunities in the UK
residential care home market;
-- be accretive to earnings once the net proceeds are fully invested;
-- further enhance the quality and diversification of the portfolio;
-- present further opportunities for value enhancing active asset management;
-- further improve the Company's operational efficiency and cost ratios; and
-- enhance the marketability of the Company and is expected to
result in a broader investor base and increased liquidity in the
Ordinary Shares.
Further information on the Placing
The New Ordinary Shares are being offered to investors pursuant
to the authority granted at the Company's General Meeting held on 5
March 2019. The Board reserves the right to increase the size of
the Placing, subject to, inter alia, investor demand, the near-term
availability of attractive investment opportunities, and the
projected financial position of the Company after the
fundraising.
The Placing is expected to close at 2:00pm on 9 May 2019 and the
results of the Placing are expected to be announced on 10 May
2019.
Applications will be made to the Financial Conduct Authority for
admission of the New Ordinary Shares to the premium segment of the
Official List and to the London Stock Exchange for admission to
trading of the New Ordinary Shares on its main market for listed
securities ("Admission"). It is expected that Admission will become
effective on 15 May 2019 and that dealings in the New Ordinary
Shares will commence at that time.
The New Ordinary Shares will, when issued, be credited as fully
paid and rank pari passu with the existing Ordinary Shares in the
capital of the Company, including the right to receive all future
dividends and distributions declared, made or paid, including the
dividend payable by the Company for the quarter to 31 March 2019,
expected to be announced in due course.
The terms of the Placing are set out in the Prospectus,
available on the Company's website at
https://www.impactreit.uk/investors/reporting-centre/prospectus/,
subject to certain access restrictions.
The dates set out in the expected timetable above may be
adjusted by the Company. In such circumstances details of the new
dates will be notified to the UK Listing Authority and the London
Stock Exchange and an announcement will be made through a
Regulatory Information Service.
FOR FURTHER INFORMATION PLEASE CONTACT:
Impact Health Partners LLP via Maitland/AMO
Mahesh Patel
Andrew Cowley
Winterflood Securities Limited Tel: 020 3100 0000
Darren Willis
Neil Langford
RBC Capital Markets Tel: 020 7653 4000
Rupert Walford
Matthew Coakes
Maitland/AMO (Communications Adviser) Tel: 020 7379 5151
James Benjamin Email: impacthealth-maitland@maitland.co.uk
Andy Donald
The Company's LEI is: 213800AX3FHPMJL4IJ53. Its home member
state is the United Kingdom.
A copy of this announcement will be available on the Company's
website at https://www.impactreit.uk.
NOTES:
Impact Healthcare REIT plc is a real estate investment trust
("REIT") which aims to provide shareholders with an attractive
return, principally in the form of quarterly income distributions
and with the potential for capital and income growth, through
exposure to a diversified portfolio of UK healthcare real estate
opportunities, in particular residential care homes. The Group's
investment policy is to acquire, renovate, extend and redevelop
high quality healthcare real estate assets in the UK and lease
those assets primarily to healthcare operators providing
residential healthcare services under full repairing and insuring
leases.
The Group has now declared or paid seven quarterly dividends of
1.50 pence per share since IPO on 7 March 2017.
The Company will seek to grow the target dividend in line with
the inflation-linked rental uplifts received by the Group under the
terms of the rent review provisions contained in the Group's leases
in the prior financial year.
The Company is listed on the premium listing segment of the
Official List of the UK Financial Conduct Authority and was
admitted to trading on the Main Market for listed securities of the
London Stock Exchange in February 2019.
IMPORTANT INFORMATION:
Neither the content of the Company's website, nor the content on
any website accessible from hyperlinks on its website for any other
website, is incorporated into, or forms part of, this announcement
nor, unless previously published by means of a recognised
information service, should any such content be relied upon in
reaching a decision as to whether or not to acquire, continue to
hold, or dispose of, securities in the Company.
This announcement has been prepared by, and is the sole
responsibility of the Directors of Impact Healthcare REIT plc and
has been prepared solely in relation to the Circular, Admission and
the Placing Programme described in this announcement.
This announcement is an advertisement and does not constitute a
prospectus relating to the Company and does not constitute, or form
part of, any offer or invitation to sell or issue, or any
solicitation of any offer to subscribe for, any shares in the
Company in any jurisdiction nor shall it, or any part of it, or the
fact of its distribution, form the basis of, or be relied on in
connection with or act as any inducement to enter into, any
contract therefor. Copies of the prospectus will, once published,
be available from the Company's website or its registered
office.
Recipients of this announcement who are considering acquiring
Ordinary Shares following publication of the prospectus are
reminded that any such acquisition must be made only on the basis
of the information contained in the prospectus which may be
different from the information contained in this announcement. In
addition, any subscription for Ordinary Shares is subject to
specific legal or regulatory restrictions in certain jurisdictions.
Persons distributing this announcement must satisfy themselves that
it is lawful to do so. The Company assumes no responsibility in the
event that there is a violation by any person of such
restrictions.
This document may not be published, distributed or transmitted
by any means or media, directly or indirectly, in whole or in part,
in or into the United States. This document does not constitute an
offer to sell, or a solicitation of an offer to buy, securities in
the United States. The securities mentioned herein have not been,
and will not be, registered under the U.S. Securities Act of 1933,
as amended (the "US Securities Act") or with any securities
regulatory authority of any state or other jurisdiction of the
United States and will not be offered, sold, exercised, resold,
transferred or delivered, directly or indirectly, in or into the
United States or to, or for the account or benefit of, any US
person (as defined under Regulation S under the US Securities Act).
The Company has not been, and will not be, registered under the
U.S. Investment Company Act of 1940, as amended.
Neither this announcement nor any copy of it may be: (i) taken
or transmitted into or distributed in any member state of the
European Economic Area (other than the United Kingdom, the Republic
of Ireland or the Netherlands), Canada, Australia, Japan or the
Republic of South Africa or to any resident thereof, or (ii) taken
or transmitted into or distributed in Japan or to any resident
thereof. Any failure to comply with these restrictions may
constitute a violation of the securities laws or the laws of any
such jurisdiction. The distribution of this announcement in other
jurisdictions may be restricted by law and the persons into whose
possession this document comes should inform themselves about, and
observe, any such restrictions.
This announcement and any offer mentioned herein if subsequently
made is directed only at: (A) persons in member states of the
European Economic Area (the "EEA") who are "qualified investors"
within the meaning of Article 2(1)(e) of the Prospectus Directive
(Directive 2003/71/EC (and amendments thereto, including Directive
2010/73/EU, to the extent implemented in the relevant member state
of the EEA) and includes any relevant implementing measure in each
relevant member state of the EEA) (the "Prospectus Directive")
("Qualified Investors"); or (B) persons in the United Kingdom who
are Qualified Investors and who (i) have professional experience in
matters relating to investments and who fall within the definition
of "investment professionals" in Article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005 (the
"Order"); or (ii) who are high net worth companies, unincorporated
associations and other persons to whom it may lawfully be
communicated in accordance with Article 49(2)(a) to (d) of the
Order; or (iii) other persons to whom it may lawfully be
communicated (all such persons together being referred to as
"Relevant Persons"). Any investment activity in connection with the
Placing will only be available to, and will only be engaged with,
Relevant Persons. Any person who is not a Relevant Person should
not act or rely on this document or any of its contents. By
accepting this communication you represent, warrant and agree that
you are a Relevant Person.
This announcement may include "forward-looking statements". All
statements other than statements of historical facts included in
this announcement, including, without limitation, those regarding
the performance of the Company's portfolio and the strategies,
performance, results of operations, financial condition and
prospects of the Company's tenants.
Forward-looking statements are subject to risks and
uncertainties and accordingly the Company's actual future financial
results and operational performance may differ materially from the
results and performance expressed in, or implied by, the
statements. These factors include but are not limited to those
described in the Circular and those which will be described in the
prospectus, once published. These forward-looking statements speak
only as at the date of this announcement. The Company expressly
disclaims any obligation or undertaking to update or revise any
forward-looking statements contained herein to reflect actual
results or any change in the assumptions, conditions or
circumstances on which any such statements are based unless
required to do so by the Financial Services and Markets Act 2000,
the Listing Rules or Prospectus Rules of the Financial Conduct
Authority or other applicable laws, regulations or rules.
Winterflood Securities Limited ("Winterflood"), which is
authorised and regulated in the United Kingdom by the Financial
Conduct Authority, and RBC Europe Limited (trading as "RBC Capital
Markets") which is authorised by the Prudential Regulation
Authority and authorised and regulated in the United Kingdom by the
Financial Conduct Authority, are each acting exclusively for the
Company and for no one else in relation to the matters described in
this announcement. Neither Winterflood nor RBC Capital Markets will
regard any other person (whether or not a recipient of this
Prospectus) as its client in relation to thereto and will not be
responsible to anyone other than the Company for providing the
protections afforded to its clients or for providing any advice in
relation to the any transaction or arrangement referred to in this
announcement. Neither Winterflood nor RBC Capital Markets makes any
representation express or implied in relation to, nor accepts any
responsibility whatsoever for, this announcement, its contents or
otherwise in connection with it or any other information relating
to the Company, whether written, oral or in a visual or electronic
format.
Information to Distributors:
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended ("MiFID II"); (b) Articles 9 and
10 of Commission Delegated Directive (EU) 2017/593 supplementing
MiFID II; and (c) local implementing measures (together, the "MiFID
II Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the MiFID II Product
Governance Requirements) may otherwise have with respect thereto,
the Ordinary Shares have been subject to a product approval
process, which has determined that the Ordinary Shares are: (i)
compatible with an end target market of retail investors and
investors who meet the criteria of professional clients and
eligible counterparties, each as defined in MiFID II; and (ii)
eligible for distribution through all distribution channels as are
permitted by MiFID II (the "Target Market Assessment").
Notwithstanding the Target Market Assessment, distributors should
note that: the price of the Ordinary Shares may decline and
investors could lose all or part of their investment; the Ordinary
Shares offer no guaranteed income and no capital protection; and an
investment in the Ordinary Shares is compatible only with investors
who do not need a guaranteed income or capital protection, who
(either alone or in conjunction with an appropriate financial or
other adviser) are capable of evaluating the merits and risks of
such an investment and who have sufficient resources to be able to
bear any losses that may result therefrom. The Target Market
Assessment is without prejudice to the requirements of any
contractual, legal or regulatory selling restrictions in relation
to the Placing Programme.
For the avoidance of doubt, the Target Market Assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of MiFID II; or (b) a recommendation to any
investor or group of investors to invest in, or purchase, or take
any other action whatsoever with respect to the Ordinary
Shares.
Each distributor is responsible for undertaking its own Target
Market Assessment in respect of the Ordinary Shares and determining
appropriate distribution channels.
PRIIPS (as defined below):
ln accordance with the Regulation (EU) No 1286/2014 of the
European Parliament and of the Council of 26 November 2014 on key
information documents for packaged retail and insurance-based
investment products ("PRIIPs") and its implementing and delegated
acts (the "PRIIPs Regulation"), the Company has prepared a key
information document (the "KID") in respect of the Ordinary Shares.
The KID is made available by the Company to "retail investors"
prior to them making an investment decision in respect of the
Ordinary Shares at www.impactreit.uk.
If you are distributing Ordinary Shares, it is your
responsibility to ensure that the KID is provided to any clients
that are "retail clients".
The Company is the only manufacturer of the Ordinary Shares for
the purposes of the PRIIPs Regulation and none of Winterflood, RBC
Capital Markets or Impact Health Partners LLP (the "Investment
Manager") are manufacturers for these purposes. None of
Winterflood, RBC Capital Markets or the Investment Manager makes
any representations, express or implied, or accepts any
responsibility whatsoever for the contents of the KID prepared by
the Company nor accepts any responsibility to update the contents
of the KID in accordance with the PRIIPs Regulation, to undertake
any review processes in relation thereto or to provide the KID to
future distributors of Ordinary Shares. Each of Winterflood, RBC
Capital Markets, the Investment Manager and their respective
affiliates accordingly disclaim all and any liability whether
arising in tort or contract or otherwise which it or they might
have in respect of the key information documents prepared by the
Company. Investors should note that the procedure for calculating
the risks, costs and potential returns in the KID are prescribed by
laws. The figures in the KID may not reflect actual returns for the
Company and anticipated performance returns cannot be
guaranteed.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IOECKQDNPBKDQQD
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