LONDON, UK: The Board of Directors of Supermarket Income REIT plc, the real estate investment trust providing secure, inflation-linked, long income from grocery property in the UK, announces its intention to raise approximately £100 million by way of a placing and an offer for subscription at an issue price of 115 pence per New Ordinary Share.
The £100 million target Initial Issue size, together with associated debt financing, should enable the Company to purchase some of the Target Assets.
The Investment Adviser has proven its ability to identify and acquire attractive investments for the Group. Since the Company’s IPO on the London Stock Exchange in July 2017, the Investment Adviser has deployed over £1.2 billion of capital (excluding acquisition costs) on behalf of the Group into a direct portfolio consisting of 35 supermarket sites and an indirect interest in a further 26 Sainsbury’s supermarkets through the Company’s joint venture with British Airways Pension Trustees Limited.
The Company continues to explore investment opportunities across the market, utilising the Investment Adviser’s extensive contacts in the UK real estate market to source investment opportunities, in particular, through access to contacts such as institutions, property companies, REITs and tenant occupiers in addition to an existing network of investment agency contracts.
In conjunction with the Initial Issue, the Directors intend to implement a Placing Programme to enable the Company to raise additional equity capital through the issue of up to 450 million Ordinary Shares over the course of the next 12 months. The Placing Programme will allow the Company to tailor future equity issuance(s) to its pipeline, providing flexibility and minimising cash drag.
The Initial Issue is being conducted in accordance with the terms and conditions to be set out in the prospectus in relation to the Initial Issue and Placing Programme (the “Prospectus”), which is expected to be published by the Company shortly following its approval by the FCA.
Both the Initial Issue and Placing Programme are subject to the approval of the shareholders of the Company (“Shareholders”) in a general meeting (the “General Meeting”), further details of which are set out in this Announcement and will be set out in the Prospectus, when published.
Nick Hewson, Chairman of the Company, said:
“The sustained growth in grocery sales, including the increased penetration of online, is driving value creation in the supermarket investment market. The Company has carefully grown its Portfolio to over £1.4 billion through selective and accretive acquisitions, whilst delivering investors a stable and growing income return.
“With an attractive Pipeline of assets in place, this fundraise will enable the Company to continue to execute on a number of transactions that meet our investment criteria, building on our strong track record of deploying capital into additional key omnichannel properties let to some of the UK’s largest supermarket operators.”
The Investment Adviser believes that there is currently an attractive opportunity for investors to gain exposure to supermarket property. Supermarket property yields continue to represent an attractive investment opportunity, largely due to the growing levels of demand in the UK grocery market and the favourable supply and demand dynamics in the underlying property investment market.
The Company continues to explore investment opportunities across the market and utilises the Investment Adviser’s extensive contacts in the UK real estate market to source investment opportunities, in particular, through access to contacts such as institutions, property companies, REITs and tenant occupiers in addition to an existing network of investment agency contracts.
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