6th Nov 2013 12:49
LONDON (Alliance News) - Redefine International PLC Wednesday said it plans to alter its tax residency to become a UK real estate investment trust (REIT) and acquire the company which provides it with investment and property management services.
Last month the company said it planned to progress with its REIT conversion as it posted pretax profit of GBP67.2 million for the full-year, compared with a GBP121.9 million loss in 2012.
The company said it was attracted to recent changes in legislation and in particular the removal of the 2% gross asset conversion charge, which it said would provide an efficient method for it to convert to a "transparent and tax efficient regime."
Redefine, domiciled in the Isle of Man, said the REIT regime is the preferred structure for both UK and international real estate investors and would assist the company by providing access to a broader range of investors.
However, it is not currently eligible for UK REIT status because it is not resident for tax purposes solely in the UK.
The board's current intention is for the company to elect for UK-REIT status with effect from December 3.
By converting to a UK-REIT, members of the group will no longer pay UK direct tax on the profits and gains from their qualifying property rental businesses in the UK and elsewhere, provided that they meet certain conditions.
The company also plans to buy RIFM, which provides it with investment and property management services.
Redefine has agreed to acquire the entire issued share capital of RFIM by the issue of 79 million shares to the RIFM sellers.
The firm expects the acquisition, which is subject to shareholder approval, to reduce its on-going administrative costs.
The stock was trading unchanged at 6.30 pence Wednesday morning.
By Anthony Tshibangu; [email protected]; @AnthonyAllNews
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