Proposed Placing

RNS Number : 4459P

Tritax Big Box REIT plc

08 June 2015

 

8 JUNE 2015

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM, THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, NEW ZEALAND OR THE REPUBLIC OF SOUTH AFRICA OR INTO ANY OTHER JURISDICTION WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OR BREACH OF ANY APPLICABLE LAW OR TO US PERSONS. PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS ANNOUNCEMENT.

THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND NOT A PROSPECTUS. THIS ANNOUNCEMENT DOES NOT CONSTITUTE OR FORM PART OF, AND SHOULD NOT BE CONSTRUED AS, ANY OFFER FOR SALE OR SUBSCRIPTION OF, OR SOLICITATION OF ANY OFFER TO BUY OR SUBSCRIBE FOR, ANY SHARES IN THE COMPANY OR SECURITIES IN ANY OTHER ENTITY, IN ANY JURISDICTION, INCLUDING THE UNITED STATES, 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, ANY CONTRACT OR INVESTMENT DECISION WHATSOEVER, IN ANY JURISDICTION. THIS ANNOUNCEMENT DOES NOT CONSTITUTE A RECOMMENDATION REGARDING ANY SECURITIES. ANY INVESTMENT DECISION REGARDING THE SHARE ISSUANCE PROGRAMME MUST BE MADE EXCLUSIVELY ON THE BASIS OF THE REGISTRATION DOCUMENT PUBLISHED BY THE COMPANY ON 8 JULY 2014 (AS SUPPLEMENTED BY THE SUPPLEMENTARY PROSPECTUS DATED 23 FEBRUARY 2015) TOGETHER WITH THE SUMMARY AND SECURITIES NOTE PUBLISHED BY THE COMPANY ON 6 MARCH 2015 IN CONNECTION, INTER ALIA, WITH ITS SHARE ISSUANCE PROGRAMME (TOGETHER, THE "PROSPECTUS").

TRITAX BIG BOX REIT PLC 

PROPOSED PLACING

The Board of Directors is pleased to announce that it intends to proceed with an institutional placing (the "Placing") of new ordinary shares (the "Placing Shares") at a price of 113 pence per share (the "Placing Price"). The Placing will comprise the final tranche of the Company's share issuance programme valid until 7 July 2015 (the "Share Issuance Programme") under which 86,147,187 ordinary shares remain available for issue. The Board intends to combine the available balance of the Share Issuance Programme with the Company's general authority to issue shares for cash on a non-pre-emptive basis (the "General Authority") with a target fundraising size of up to £125 million¹. The Placing Shares to be issued under the General Authority will be issued on the same terms as the Placing Shares to be issued under the Share Issuance Programme.

Since the placing undertaken by the Company in March 2015, which raised gross proceeds of £175 million, the Company has acquired five Big Box logistics warehouse assets for a total investment price of approximately £238.2 million (net of acquisition costs).  The Company has also completed on two additional forward funded pre-let developments for an aggregate investment price of £72.1 million.  As a result, the Company has invested or committed substantially all of the net investable funds available to it in accordance with its Investment Policy.

The Company's pipeline continues to be strong and the Manager is engaged in detailed discussions with the current owners of a number of other suitable assets that meet the Company's Investment Policy and are available for potential acquisition in the near term.  

The Placing Price reflects a 2.8 per cent. discount to the closing price of 116.25 pence per ordinary share on 5 June 2015.  The Placing is expected to be Net Asset Value accretive for existing Shareholders (net of fees and expenses associated with the Placing).          

The Placing 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 (but not the second interim dividend of 1.5 pence per ordinary share declared today in respect of the period from 1 March 2015 to 31 May 2015).

The Company is targeting an aggregate dividend of 6.0 pence per ordinary share for the year ending 31 December 2015².

Note:

(1)  The Directors have reserved the right, in consultation with Jefferies, to increase the size of the Placing up to a maximum of approximately £148 million if overall demand exceeds the target fundraising size of up to £125 million, with any such increase being announced through a Regulatory Information Service.

(2)  The target dividend is a target only and not a profit forecast. There can be no assurance that the target will be met and it should not be taken as an indication of the Company's expected or actual future results. Potential investors should not place any reliance on this target and any investment decision regarding the Share Issuance Programme should be made exclusively on the basis of the Prospectus.

VALUATION AND UNAUDITED NET ASSET VALUE UPDATE

The Group's investment properties have been independently valued as at 30 April 2015 at £766.4 million (including forward funded commitments), representing an uplift of approximately 11.0 per cent over the aggregate acquisition price (excluding acquisition costs).

The Company's unaudited EPRA Net Asset Value per ordinary share as at 30 April 2015 is 110.9 pence (the Company's unaudited Basic Net Asset Value is 110.5 pence as at the same date). This represents an increase of 3.1 per cent as compared to the audited EPRA Net Asset Value as at 31 December 2014 of 107.6 pence (audited Basic Net Asset Value of 107.0 pence).

PORTFOLIO HIGHLIGHTS

The Group's portfolio currently comprises twenty two Big Box logistics warehouse assets, of which four are forward funded pre-let developments.  Key highlights of the current portfolio include:

·    Current portfolio valuation of £1.05 billion³ (including forward funded commitments)

·    Average unaudited net initial yield (at acquisition and net of costs) of 5.8 per cent

·    Weighted average unexpired lease term across the portfolio of 15.4 years

·    Annualised rent roll of £59.0 million, including forward funded income

·    Portfolio fully let or contracted and income producing

·    Loan to value ratio across all assets of 25.8 per cent⁴ with long term debt drawn of £272.0 million

·    Blended margin payable across the Company's financings of 1.76 per cent above three month LIBOR

Note:

(3)  All properties included as per 30 April 2015 independent valuation with the exception of properties acquired after this date, which are included at purchase price.

(4)  The Company is currently reviewing its debt strategy with a view to reducing its overall cost of borrowing and continues to target a 40 per cent loan to value ratio over the medium term.

FTSE 250 INDEX INCLUSION

The Board is pleased to note the announcement by FTSE on 3 June 2015 confirming the inclusion of the Company in the FTSE 250 Index with effect from today.

EXPECTED TIMETABLE

Placing opens	8 June 2015
Latest time and date for receipt of Placing commitments	3.00 p.m. on 17 June 2015
Announcement of the results of the Placing	18 June 2015
Admission of the ordinary shares to the Official List and to trading on the London Stock Exchange's main market for listed securities	8.00 a.m. on 22 June 2015
Crediting of CREST stock accounts	22 June 2015
Share certificates despatched (where appropriate)	week commencing 29 June 2015 (or as soon as possible thereafter)

The Company, in consultation with the Manager and the Joint Financial Advisers, reserves the right to close the Placing early. In such event, the Company will notify investors by the publication of a notice through a Regulatory Information Service.

DEALING CODES

Ticker	BBOX
ISIN for the ordinary shares	GB00BG49KP99
SEDOL for the ordinary shares	BG49KP9

Further details of the Share Issuance Programme are set out in the Prospectus which is available on the Company's website at www.tritaxbigbox.co.uk. Any capitalised terms not defined in this announcement have the meaning set out in the Prospectus.

For further information, please contact:

Tritax Group Colin Godfrey (Partner, Fund Manager)	via Newgate (below)
Newgate (PR Adviser) James Benjamin Andre Hamlyn Lois Engstrand	Tel: [phone] Email: [e-mail]
Jefferies International Limited (Joint Financial Adviser and Sole Bookrunner) Gary Gould Stuart Klein	Tel: [phone]
Akur Limited (Joint Financial Adviser) Anthony Richardson Tom Frost	Tel: [phone]

NOTES:

Tritax Big Box REIT plc is a real estate investment trust to which Part 12 of the UK Corporation Tax Act 2010 applies ("REIT"). The Company invests in and asset manages a portfolio of well-located, modern "Big Box" assets, typically targeting buildings greater than 500,000 sq. ft., let to institutional-grade tenants on long-term leases (typically between 12 and 25 years in length) with upward-only rent reviews (providing the potential for inflation linked earnings growth), and with geographic and tenant diversification throughout the UK. The Company seeks to exploit the significant opportunity in this sub-sector of the UK logistics market owing to strong tenant demand in high growth areas of the economy and limited stock supply. The Company is the first listed vehicle to give pure exposure to the "Big Box" asset class in the UK.

Further information on Tritax Big Box REIT is available at www.tritaxbigbox.co.uk 

IMPORTANT NOTICE

The information in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. The material set forth herein is for information purposes only and is not intended, and should not be construed, as an offer of securities for sale in the United States or any other jurisdiction. 

This announcement is not for publication or distribution, directly or indirectly, in whole or in part, in, into or from the United States (including its territories and possessions, any state of the United States and the District of Columbia), Australia, Canada, South Africa, New Zealand or Japan. The distribution of this announcement may be restricted by law in certain jurisdictions and persons into whose possession 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.

This announcement is an advertisement and not a prospectus. Investors should not subscribe for or purchase any transferable securities under the Share Issuance Programme referred to in this announcement except on the basis of information in the Prospectus. Copies of the Prospectus are available on the Company's website (www.tritaxbigbox.co.uk).

This announcement does not contain or constitute an offer for sale of, or the solicitation of an offer or an invitation to buy or subscribe for, Placing Shares to any person in the United States, Australia, Canada, South Africa, New Zealand or Japan or in any jurisdiction to whom or in which such offer or solicitation is unlawful.

The Company has not been and will not be registered under the US Investment Company Act of 1940, as amended (the "US Investment Company Act"). In addition, the Placing Shares have not been and will not be registered under the US Securities Act of 1933, as amended (the "US Securities Act") or under the securities laws of any state or other jurisdiction of the United States, and may not be offered, sold or transferred, directly or indirectly, in the United States or to, or for the account or benefit of, US persons (as defined in Regulation S under the US Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act, in compliance with any applicable securities laws of any state or other jurisdiction of the United States, and under circumstances that will not require the Company to register under the US Investment Company Act. There will be no public offer of the Placing Shares in the United States.

The offer and sale of Placing Shares referred to herein has not been and will not be registered under the applicable securities laws of any state, province or territory of Australia, Canada, South Africa, New Zealand or Japan. Subject to certain exceptions, the Placing Shares referred to herein may not be offered or sold in Australia, Canada, South Africa or Japan or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada, South Africa, New Zealand or Japan.

No action has been taken that would permit an offering of the Placing Shares or possession or distribution of this announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is that required.

In member states of the European Economic Area ("EEA"), this announcement is only addressed to and directed at persons 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).

No reliance may or should be placed by any person for any purposes whatsoever on the information contained in this announcement or on its completeness, accuracy or fairness. The information contained in this announcement is given at the date of its publication (unless otherwise marked) and is subject to updating, revision and amendment. In particular, the proposals referred to herein are tentative and are subject to verification, material updating, revision and amendment.

The Placing timetable may be influenced by a range of circumstances such as market conditions. There is no guarantee that the Placing will occur and prospective investors should not base their financial decisions on the Company's intentions in relation to the Placing or the information contained in this announcement. 

The comparability of the information on the Company's performance to date to its future performance is by its nature limited for a variety of reasons. Without limitation, results can be positively or negatively affected by market conditions beyond the control of the Company or the Manager, which market conditions may be different in many respects from those that prevail at present or in the future, with the result that the performance of investment portfolios originated now may be significantly different from those originated in the past. Neither the past performance of the Company nor the Manager is a reliable indicator of, and cannot be relied upon as a guide to, the future performance of the Company or the Manager. Prospective investors should be aware that any investment in the Company is speculative, involves a high degree of risk, and could result in the loss of all or substantially all of their investment. 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 and prospective investors should note that the value of the Placing Shares can decrease as well as increase. 

Each of Jefferies and Akur is authorised and regulated by the Financial Conduct Authority, and is acting exclusively for the Company and no-one else in connection with the Placing. They will not regard any other person as their respective clients in relation to the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, nor for providing advice to any other person in relation to the Placing, the contents of this announcement or any transaction, arrangement or any other matter referred to herein. 

In connection with the Placing, each of Jefferies and Akur and any of their respective affiliates, acting as investors for their own accounts, may purchase Placing Shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such Placing Shares and other securities of the Company or related investments in connection with the Placing or otherwise. Accordingly, references in the announcement to the Placing Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by Jefferies, Akur and any of their affiliates acting as investors for their own accounts. Jefferies and Akur do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

So far as permitted by law, none of the Company, the Manager, Jefferies, Akur nor any of their respective affiliates accepts any responsibility or liability whatsoever for or makes any representation or warranty, express or implied, as to this announcement, including the truth, accuracy or completeness or sufficiency of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of the announcement or its contents or otherwise arising in connection therewith. Save as aforesaid, the Company, the Manager, Jefferies, Akur and their respective affiliates accordingly disclaim all and any liability whether arising in tort, contract or otherwise which they might otherwise have in respect of this announcement or its contents or otherwise arising in connection therewith.

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements relate to matters that are not historical facts. By their nature, forward- looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. The Company's actual investment performance, results of operations, financial condition, liquidity, dividend policy and the development of its financing strategies may differ materially from the impression created by the forward-looking statements contained in this announcement. In addition, even if the investment performance, results of operations, financial condition, liquidity and dividend policy of the Company and development of its financing strategies, are consistent with the forward-looking statements contained in this announcement, those results or developments may not be indicative of results or developments in subsequent periods.  No statement in this announcement is or is intended to be a profit forecast or profit estimate or to imply that the earnings of the Company for the current or future financial years will necessarily match or exceed the historical or published earnings of the Company.

These forward-looking statements speak only as at the date of this announcement. Subject to its legal and regulatory obligations (including under the Prospectus Rules and the Disclosure and Transparency Rules of the UK Listing Authority), the Company expressly disclaims any obligations to update or revise any forward-looking statement contained herein to reflect any change in expectations with regard thereto or any change in events, conditions or circumstances on which any statement is based. Each of the Manager, Jefferies, Akur and their respective affiliates expressly disclaim any obligation or undertaking to update, review or revise any forward-looking statement contained in this announcement whether as a result of new information, future developments or otherwise.

Certain figures contained in this announcement, including financial information, have been subject to rounding adjustments. Accordingly, in certain instances, the sum or percentage change of the numbers contained in this document may not conform exactly with the total figure given.

This announcement does not constitute a recommendation concerning the Placing. The price and value of the Placing Shares and income from them may go down as well as up and investors may not get back the full amount invested on disposal of the Placing Shares. Past performance is not a guide to future performance. Information in this announcement or any of the documents relating to the Placing cannot be relied upon as a guide to future performance. Before purchasing any Placing Shares, persons viewing this announcement should ensure that they fully understand and accept the risks that are set out in the Prospectus. The contents of this announcement are not to be construed as legal, business or tax advice. Each prospective investor should consult his, her or its own legal adviser, financial adviser or tax adviser for legal, financial or tax advice.

 

END

 

 

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