3rd Jun 2015 07:27
LONDON (Alliance News) - Dolphin Capital Investors Ltd Wednesday said it has completed a strategy review initiated earlier this year, separating its investments into core projects and non-core assets, while also revealing plans to raise EUR75 million by issuing new shares in a move designed to cover its running costs for two years and to repay convertible bonds.
The company, which invests in high-end residential resorts in the Eastern Mediterranean, Caribbean and Central America, plans to raise EUR62 million in new equity through an accelerated bookbuild with institutional investors, while a further EUR13 million will come from the conversion of 2016 convertible bonds.
Dolphon Capital Investors noted that the new shares are likely to be issued at a "significant discount" to the 78 pence per share net asset value recorded at the end of December, when NAV per share after deferred income tax liabilities was 68p.
Dolphin Capital Investors, which is managed by private equity firm Dolphin Capital Partners, launched the review of its strategy in February, when it appointed several new non-executive directors, including businessman Laurence Geller who became its new chairman.
The strategy review, which aimed to narrow the share price discount to net asset value and accelerate returns for shareholders, means that Dolphin Capital Investors will focus on core projects, which are the company's existing developments. These are Amanzoe, Kilada Hills and the Kea Resort in Greece, Playa Grande Club & Reserve in the Dominican Republic, and Pearl Island in Panama.
The company intends to sell its real estate non-core assets in an orderly manner, while its equity investment in Aristo Developers Ltd has also been classed as non-core.
In addition, an agreement with Dolphin Capital Partners means the investment manager will no longer receive an annual management fee equivalent to 2% of the company's equity funds. If shareholders approve, the investment manager will from January 2017 receive the lower of either a flat fee of EUR8.5 million or 1.25% of the company's gross assets. Until then, the management fee will be EUR6 million for the second half of 2015 and EUR8.5 million for 2016.
Chairman Laurence Geller said that the package of measures developed under the strategy review will give the company a "solid basis to enable the acceleration of returns to shareholders and that the implementation of the refocused strategy will deliver a more robust business".
"The company is making good progress, as evidenced by the uplift in NAV, and market dynamics in the tourism sector are in the company's favour. On that basis, the outlook for 2015 and beyond is encouraging," Geller said in a statement.
Dolphin Capital Investors said its net asset value increased to EUR644 million at the end of 2014, a EUR13 million increase on figures for the third quarter, while after deferred income tax liabilities NAV was up EUR12 million to EUR557 million.
Dolphin Capital Investors shares were up 0.3% at 22.57 pence on Wednesday.
By Samuel Agini; [email protected]; @samuelagini
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