22nd Oct 2020 10:20
(Alliance News) - Shaftesbury PLC on Thursday said it intends to raise GBP307 million via the issue of new shares to ensure financial flexibility to navigate the "unprecedented" challenges created by the Covid-19 pandemic.
"Having assessed the group's financial position in light of the implications of the Covid-19 pandemic for its short- and medium-term prospects, the board has decided to issue equity by way of a firm placing, placing and open offer, and offer for subscription to help ensure the group maintains a strong financial base, is positioned to return to long-term growth as pandemic issues recede and, should conditions improve, is able to invest further in its exceptional portfolio," the FTSE 250-listed property company explained.
Shaftesbury, which is focused on London's west end tourist district, intends to issue up to 37.15 million new ordinary shares at 400 pence each under a firm placing, raising gross proceeds of GBP148.6 million. A further 37.10 million shares will be issued under a placing and open offer at the same 400p price, raising gross proceeds of GBP148.4 million.
Finally, the company intends to issue up to 2.5 million shares under a subscription offer to raise up to another GBP10 million gross.
Shares in Shaftesbury were down 13% at 432.40 pence each in London on Thursday morning.
Net proceeds of the firm placing, placing and open offer is expected to amount to GBP285.0 million, which could be increased by the subscription offer, to a net total of GBP294.7 million.
Separately, Capital & Counties Properties PLC said it will participate in the Shaftesbury fundraise by providing GBP65 million.
Following the investment, the London's Covent Garden market operator will own a 25% stake in Shaftesbury.
"The board believes that the investment is priced attractively in view of the long-term prospects and resilience of prime central London and is consistent with Capco's strategy to invest in attractive opportunities on or near the Covent Garden estate," Capital & Counties said.
Including holding in Shaftesbury shares, Capital & Counties currently has access to over GBP1 billion of liquidity.
Shares in Capital & Counties were down 11% at 101.30 pence each in London, down 12% in Johannesburg at ZAR21.61.
By Tapan Panchal; [email protected]
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