TIDMSIR
RNS Number : 0365I
Secure Income REIT PLC
16 March 2018
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE
UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY OTHER
JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION
WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR IMMEDIATE
RELEASE.
16 March 2018
Secure Income REIT Plc
(the "Company")
SECURE INCOME REIT SUCCESSFULLY CLOSES OVERSUBSCRIBED GBP315.5
MILLION PLACING FOR GBP436 MILLION ACQUISITIONS
Further to the Company's announcements of 9 March 2018 and 15
March 2018, the board of directors of Secure Income REIT Plc (AIM:
SIR), the specialist long term income REIT, is pleased to announce
that the Company has successfully raised gross proceeds of GBP315.5
million in a significantly oversubscribed Placing of 86,438,000
Ordinary Shares (the "Placing Shares"), completing the Placing over
a week earlier than planned following strong investor demand.
The Placing remains conditional on, inter alia, (i) the approval
of the Resolutions by Shareholders at the Company's General Meeting
to be held at 2.30 p.m. on 27 March 2018 (or any adjournment
thereof); (ii) the Placing Agreement becoming or being declared
unconditional in all respects and not having been terminated in
accordance with its terms; and (iii) Admission becoming effective.
It is expected that Admission will become effective, and dealings
for normal settlement in the Placing Shares will commence, at 8.00
a.m. on 29 March 2018.
The Placing Shares will be issued at a price of 365.0 pence per
Placing Share (the "Placing Price") pursuant to the terms and
conditions of the Placing set out in the Company's announcement of
9 March 2018.
The Placing Shares, when issued, will be credited as fully paid
and will rank pari passu in all respects with the Company's
existing Ordinary Shares.
Martin Moore, Non-Executive Chairman of the Company,
commented:
"The GBP315.5 million placing has been oversubscribed and has
closed early, which is a testament to the validity of the
investment thesis being implemented by a heavily invested, aligned
and committed management team. We are very pleased with the
significant investor support for this fundraising, with strong
demand from a broad range of shareholders. We would like to thank
our existing shareholders for their continued support and also to
welcome our new investors to the Company. We continue to view the
future of the Company with confidence."
Nick Leslau, Chairman of Prestbury Investments LLP, Investment
Adviser to the Company, said:
"The proceeds from this placing finance the acquisition of two
substantial and attractive off-market portfolios, exchanged
simultaneously and at a total gross cost of GBP436 million, which
meet the Board's strict investment returns and quality criteria.
The acquisitions will be significantly dividend accretive, will
materially deleverage the Group's balance sheet and will reduce the
Group's weighted average cost of debt, while also maintaining the
Group's very long weighted average unexpired lease term.
The assets to be acquired complement the Group's existing
portfolio of key operating assets in defensive sectors let to
strong covenants on long leases, providing income security, the
core of the Group's business. The acquisitions include Manchester
Arena, the UK's largest indoor entertainment arena, 76 Travelodge
hotels and the largest catered event space in the City of London at
the Chiswell Street Brewery. Attractive and secure income growth
will continue to be delivered from the upwards only RPI reviews and
fixed rental uplifts in 99% of the enlarged Group's rent roll,
positioning the Group very well to maintain its track record of
providing attractive total shareholder returns for the long
term.
The Prestbury team will be investing GBP5.1 million in the
Placing and, following completion, will have c.GBP158 million (at
the Placing Price) invested in the Company, one of the largest
management shareholdings in the quoted UK real estate sector."
Related Party considerations
Prestbury and Board participation in the Placing
Members of the Prestbury Management Team and members of the
Board and certain of their associates, who own Ordinary Shares at
the date of this announcement worth approximately GBP137 million at
the Placing Price, have further invested over GBP5.25 million in
the Company pursuant to the Placing. These investments are shown in
the table below:
Percentage
Number of of issued
Number of Ordinary Shares share capital
Ordinary Shares held immediately held immediately
acquired under after the after the
the Placing Placing Placing(6)
Board and Management
Team
Nick Leslau(1)
(3) (4) 821,917 1,491,709 0.46%
Nigel Wray(2)
(3) 273,972 273,972 0.09%
Martin Moore 27,397 118,357 0.04%
Mike Brown(4) 273,972 1,183,581 0.37%
Sandy Gumm(4) 27,397 192,573 0.06%
Ian Marcus 13,698 87,002 0.03%
Other associated
investors
Richard Grosse(5) 178,100 445,405 0.14%
(1) Shares subscribed through Yoginvest Limited, a company which
is controlled by Nick Leslau. In addition, Nick Leslau is
interested in PIHL Property LLP as set out in (3) below. Nick
Leslau is also a beneficiary of the Saper Trust which holds 57,471
Ordinary Shares in the Company.
(2) In addition to these shares, Nigel Wray is interested in
PIHL Property LLP as set out in (3) below.
(3) In addition to the holdings disclosed above, 22,466,916
Ordinary Shares in the Company are held by PIHL Property LLP.
Ultimately, through indirect ownership, Nick Leslau has a 47.4 per
cent voting interest and a 71.1 per cent economic interest in those
Ordinary Shares and Nigel Wray has a 44.6 per cent voting interest
and 22.3 per cent economic interest.
(4) Nick Leslau, Mike Brown and Sandy Gumm all have indirect
interests in Prestbury Incentives Limited through their interests
in the Investment Adviser, Prestbury Investments LLP. Prestbury
Incentives Limited is a wholly owned subsidiary of the Investment
Adviser. Prestbury Incentives Limited holds 13,183,411 Ordinary
Shares in the Company and will receive a further 4,588,479 Ordinary
Shares on 20 March 2018 to satisfy existing obligations under the
Investment Advisory Agreement, as outlined in the Company's 9 March
2018 preliminary results announcement.
(5) Richard Grosse is a trustee of the Saper Trust (see also
note (1)) and accordingly he is disclosed as a related party. He is
not a member of the Board or Management Team.
(6) Calculated on the sum of (a) 230,536,874 Ordinary Shares
currently in issue, (b) 4,588,479 Ordinary Shares to be issued on
20 March 2018 in relation to the Incentive Shares noted in point
(4) and (c) 86,438,000 Ordinary Shares to be issued in the
Placing.
Under the AIM Rules, the subscriptions referred to above
constitute related party transactions.
The independent directors of the Company, which for these
purposes exclude any director who participated in the Placing,
having consulted with Stifel Nicolaus Europe Limited as the
Company's Nominated Adviser, consider that the terms of the
subscriptions referred to above are fair and reasonable in so far
as shareholders of the Company are concerned.
Substantial shareholder participation in the Placing
Artemis Investment Management LLP, on behalf of discretionary
funds under management, ("Artemis") and Invesco Asset Management
Limited, as agent for and on behalf of its discretionary managed
clients, ("Invesco") are considered Substantial Shareholders under
the AIM Rules and their participation in the Placing, as set out
below, therefore constitutes related party transactions under Rule
13 of the AIM Rules.
Percentage
Number of Ordinary of issued share
Number of Ordinary Shares held capital held
Shares acquired immediately immediately
under the Placing after the Placing after the Placing(7)
Artemis 14,264,383 59,909,594 18.6%
Invesco 14,991,780 40,183,374 12.5%
(7) Calculated on the sum of (a) 230,536,874 Ordinary Shares
currently in issue; (b) 4,588,479 Ordinary Shares to be issued on
20 March 2018 in relation to the Incentive Shares; and (c)
86,438,000 Ordinary Shares to be issued in the Placing
The Directors, having consulted with Stifel Nicolaus Europe
Limited as the Company's nominated adviser, consider that the terms
of both Artemis and Invesco's participation in the Placing are fair
and reasonable in so far as shareholders of the Company are
concerned.
Issued Share Capital
Following Admission of the Placing Shares, and in accordance
with the Disclosure Guidance and Transparency Rules, the Company's
issued share capital will comprise 321,563,353 Ordinary Shares
(which includes 4,588,479 Ordinary Shares to be issued to Prestbury
Incentives Limited on 20 March 2018 as described in the Company's
preliminary results announcement of 9 March 2018). There are no
Ordinary Shares held in treasury. Accordingly the total number of
voting rights in the Company will be 321,563,353. The above figure
may be used by Shareholders as the denominator for the calculations
by which they will determine if they are required to notify their
interest in, or a change in their interest in, the issued share
capital of the Company under the Disclosure Guidance and
Transparency Rules.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Secure Income REIT Plc +44 20 7647
Nick Leslau 7647
Mike Brown enquiries@SecureIncomeREIT.co.uk
Sandy Gumm
Stifel Nicolaus Europe Limited +44 20 7710
(Nominated Adviser & Sole Bookrunner) 7600
Mark Young stifelsecureincomereit@stifel.com
David Arch
Tom Yeadon
Newgate (PR Adviser) +44 20 7680
James Benjamin 6550
Anna Geffert sir@newgatecomms.com
Leena Patel
Defined terms used in this announcement shall (unless the
context otherwise requires) have the same meaning as set out in the
Company's announcement of 9 March 2018.
The Company's LEI is: 213800M1VI451RU17H40
IMPORTANT NOTICES
This announcement has been prepared by and is the sole
responsibility of the Company.
This announcement is only being distributed to and is only
directed at (i) investment professionals falling within Article
19(5) of the Financial Promotion Order; (ii) high net worth
entities, and other persons to whom it may lawfully be
communicated, falling within Article 49(2)(a) to (d) of the
Financial Promotion Order; or (iii) other persons to whom it may
lawfully be communicated (all such persons together being referred
to as "Relevant Persons"). The securities proposed to be issued are
only available to, and any invitation, offer or agreement to
subscribe, purchase or otherwise acquire such securities will be
engaged in only with, Relevant Persons. Any person who is not a
Relevant Person should not act or rely on this announcement or any
of its contents.
The information contained in this announcement is for background
purposes only and does not purport to be full or complete.
This announcement does not constitute, or form part of, any
offer or invitation to sell or issue, or any solicitation of any
offer to purchase or subscribe for any Ordinary Shares or other
securities of the Company in any jurisdiction, including the United
States, Australia, Canada, Japan or South Africa or in any
jurisdiction in which such offer or sale would be unlawful prior to
registration, exemption from registration or qualification under
the securities laws of any jurisdiction. The Placing and the
distribution of this announcement and other information in
connection with the Placing in certain jurisdictions may be
restricted by law and persons into whose possession this
announcement, any document or other information referred to herein
comes should inform themselves about and observe any such
restriction. Any failure to comply with these restrictions may
constitute a violation of the securities laws of any such
jurisdiction. Neither this announcement nor any part of it nor the
fact of its distribution shall form the basis of or be relied on in
connection with or act as an inducement to enter into any contract
or commitment whatsoever.
The Placing timetable may be influenced by a range of
circumstances, including market conditions. Investing in shares to
which this announcement relates may expose an investor to a
significant risk of losing all of the amount invested. Persons
considering making such an investment should consult an authorised
person specialising in advising on such investments. This
announcement does not constitute a recommendation concerning the
Placing or any investment in the Company. The value of the
Company's Ordinary Shares can decrease as well as increase.
Potential investors should consult a professional adviser as to the
suitability of the Placing for the person concerned. Past
performance cannot be relied upon as a guide to future
performance.
This announcement is not for distribution, directly or
indirectly, in whole or in part, in or into the United States
(including its territories and possessions, any State of the United
States and the District of Columbia), Australia, Canada, Japan or
South Africa or any other jurisdiction where it is unlawful to
distribute this announcement. In particular, this announcement is
not an offer of securities for sale in the United States. The
Placing Shares have not been and will not be registered under the
Securities Act or under any securities laws of any State or other
jurisdiction of the United States, and may not be offered or sold
in the United States except pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act. There will be no public offer of the securities
referred to herein in any jurisdiction, including in the United
States, Australia, Canada, Japan or South Africa. The Placing
Shares have not been registered under the applicable securities
laws of Australia, Canada, Japan, or South Africa and, subject to
certain exceptions, may not be offered or sold within Australia,
Canada, Japan or South Africa or to any national, resident or
citizen of Australia, Canada, Japan or South Africa.
Solely for the purposes of 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 Placing Shares have been
subject to a product approval process, which has determined that
the Placing 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 guaranteed capital
protection; and an investment in the Ordinary Shares is suitable
only for investors who do not need a guaranteed income or
guaranteed 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. Furthermore, it is noted
that, notwithstanding the Target Market Assessment, Stifel will
only procure investors who meet the criteria of professional
clients and eligible counterparties.
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 (for the purposes of the MiFID II Product
Governance Requirements) is responsible for undertaking its own
target market assessment in respect of the Ordinary Shares and
determining appropriate distribution channels.
Stifel, which is authorised and regulated in the United Kingdom
by the FCA, is acting as bookrunner and nominated adviser
connection with the matters referred to herein, and will not be
responsible to anyone other than the Company for providing the
protections afforded to its clients, nor for providing advice in
relation to the contents of the announcement or any transaction or
arrangement referred to herein.
Apart from the responsibilities and liabilities, if any, which
may be imposed on Stifel by the FSMA or the regulatory regime
established thereunder, Stifel accepts no responsibility
whatsoever, and makes no representation or warranty, express or
implied, in relation to the contents of the announcement, including
its accuracy, completeness or verification or for any other
statement made or purported to be made by it, or on behalf of it,
the Company, the directors, the Investment Adviser or any other
person in connection with the Company, the Placing, the Placing
Shares or the matters referred to herein, and nothing in this
announcement is or shall be relied upon as a promise or
representation in this respect, whether as to the past or future.
Stifel accordingly disclaims all and any liability whether arising
in tort, contract or otherwise (save as referred to above), which
it might otherwise have in respect of the announcement or any such
statement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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