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Civitas to Enter FTSE 250

Mon, 22nd Apr 2019

Civitas Social Housing PLC is set to be added to the FTSE 250 as of Tuesday. The company is a real estate investment trust that is under the management of Civitas Housing Advisors Ltd.

Civitas made an IPO in November 2016, and this raised GBP350 Million. A year later, they raised an additional GBP 302 million thanks to a C share issue, and they also took out some secured loans.

Last Friday, they purchased three social housing properties, at a total cost of GBP 3.7 million, which was funded using some of the cash resources left from the C share issue. The company has invested more than two thirds of their C Share funds.

Following the announcement that the company would be joining the FTSE 250, shares in Civitas Social Housing increased in value by 1.9 percent. The promotion to the mid cap index was unexpected for the company. Meanwhile, Woodford Patient Capital Trust is set to be removed from the index. Russell group said that it had ‘inadvertently’ added the company to the index last month. Shares in Woodford fell by 1.8 percent following the news that the company would be dropping back out of the index.

No explanation has been given for how the mistake occurred, but analysts at Numis Securities believe that the index provider had made the mistake of overlooking the C shares that Civitas had issued. It is those C Shares that lifted the company’s market capitalisation over the threshold for inclusion.

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