Possible Merger

RNS Number : 7253K

UK Commercial Property Trust Ltd

23 April 2010

 



23 April 2010

UK COMMERCIAL PROPERTY TRUST LIMITED

ANNOUNCEMENT REGARDING POSSIBLE MERGER

The Board of UK Commercial Property Trust Limited ("UKCPT") notes today's announcement by F&C Commercial Property Trust Limited ("FCPT") and confirms that it is reviewing a proposal from Ignis Investment Services Limited ("Ignis"), the investment manager of UKCPT, regarding a proposed merger of UKCPT and FCPT.

It has been proposed that the merger would be implemented by means of a liquidation scheme of reconstruction ("Scheme").  The Scheme would involve the sale of FCPT's property holding subsidiaries, together with associated debt, in exchange for the issue to FCPT's shareholders of shares in UKCPT on a net asset value ("NAV") for NAV basis.  The proposed Scheme would also offer FCPT's shareholders the opportunity to elect for a cash exit. 

Friends Provident Life and Pensions Limited and Friends Provident Life Assurance Limited (together "FP"), Phoenix Life Limited and Phoenix and London Assurance Limited have irrevocably undertaken between themselves to support the Scheme, and will not sell their respective holdings of shares in FCPT or UKCPT prior to the Scheme being effected or withdrawn (subject to the full terms of the Scheme being announced prior to 30 September 2010) and will not elect for cash under the Scheme.

FP and Phoenix Group Holdings ("Phoenix Group"), through a number of subsidiaries, are the majority shareholders in FCPT and UKCPT respectively.  Phoenix Group is also the owner of Ignis. 

In conjunction with the proposal from Ignis and the irrevocable undertakings by FP and subsidiaries of Phoenix Group to support the Scheme, FCPT has announced today the proposed sale of 16.15 per cent of its issued share capital by FP to Phoenix Life Limited, a subsidiary of Phoenix Group.

The UKCPT Board, which is being advised by Execution Noble & Company Limited, will consider this proposal carefully and undertake appropriate due diligence, taking into account the best interests of all shareholders.  There can be no certainty as to whether or not the proposal will result in any scheme being implemented.  The proposed merger will also be subject to approval by UKCPT and FCPT shareholders.

Based on the current structure of the proposed transaction by way of a Scheme, it is expected that the Scheme would fall outside the provisions of The City Code on Takeovers and Mergers.

Any further announcements on this matter will be made by the Board of UKCPT as and when appropriate.

All Enquiries:

UK Commercial Property Trust

John Llewellyn-Lloyd / Peter Tracey, Execution Noble & Co. Limited:         020 7456 9191

Financial Adviser to UKCPT

Richard Sunderland/Rachel Drysdale/Olivia Goodall, FD:                           020 7831 3113

Financial PR Adviser to UKCPT

Ignis Investment Services Limited

Steven Beveridge, Head of Strategic Development:            0141 222 8648 / 07793006800

Gary Hutcheson, Investment Director (Property)    :           0141 222 8014 /07733307573

Phoenix Group

Daniel Godfrey:                                                              020 7489 4517 / 07897 937 890

Director of Corporate Communications

Notes to editors:

UK Commercial Property Trust

The UK Commercial Property Trust is a closed-ended Guernsey registered investment company, dedicated to investments in commercial real estate throughout the UK. 

It is managed by Ignis Asset Management and its shares are listed and traded on the Official List of the London Stock Exchange, where it has a market cap of approximately £960 million (as at 23 April 2010).

UKCPT's investment objective is to provide shareholders with an attractive level of income together with the potential for capital and income growth through its diversified UK commercial property portfolio.

As at 31 December 2009, UKCPT had a cash balance of around £70 million and £38 million of undrawn loan facilities.  Its property portfolio has consistently been ranked in the top quartile for covenant strength in the IPD Iris index since launch in September 2006.

 In February 2010 it successfully concluded a fully subscribed Placing and Offer which raised in excess of £150 million.  Since the Placing and Offer, it has acquired two significant retail assets for a total consideration of approximately £117 million. The Trust is actively pursuing further strategic assets to utilise the cash balance in accordance with its investment strategy.

 

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