22nd Jul 2019 11:48
(Alliance News) - LXI REIT PLC on Monday said it has agreed a GBP100 million revolving credit facility which is intended to gear the proceeds of an equity raise.
In June, the real estate investment trust raised roughly GBP200 million from a 169.1 million share issue priced at 118 pence per share and said the new loan is intended to gear the net proceeds of this placing.
The new facility has been provided by Lloyds Bank PLC with a margin of 1.6% per annum over LIBOR and has an initial three-year term which can be extended another two years. It is secured against a portfolio of LXI's assets.
Once the loan is drawn, LXI's loan-to-value ratio will be maintained at 30%, which aligns with its medium-term target and is below the maximum of 35%. LXI intends to "hedge the underlying interest rate with a cap instrument".
LXI REIT Advisors Ltd Partner John White said: "We are pleased to have agreed this new revolving credit facility with Lloyds Bank, which will provide the company with flexible and cost-efficient committed capital, to invest in additional long-let and index-linked assets, which we expect will deliver further value for our shareholders. The continued backing from our core relationship loan provider underlines the strength of support for the company and our investment strategy as well as the strong fundamentals of the inflation-protected long income real estate sector."
Shares in LXI were down 0.6% at 127.20 pence on Monday.
Related Shares:
LXI.L