5th Aug 2009 07:00
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL
Wichford P.L.C ("Wichford" or the "Company") announces a fully underwritten Rights Issue to raise net proceeds of approximately £52.2 million
The Board of Wichford P.L.C., the property investment company, today announces a fully underwritten 7 for 1 Rights Issue to raise proceeds of approximately £52.2 million, net of expenses, by the issue of 929,333,636 New Shares at a price of 6 pence per New Share. The Rights Issue is subject to approval by Shareholders at a General Meeting to be held on 28 August 2009.
Highlights
7 for 1 Rights Issue of 929,333,636 New Shares at a price of 6 pence per New Share, representing a 68.8 per cent. discount to the closing middle market price of 19.25 pence per Ordinary Share and a 21.6 per cent. discount to the Theoretical Ex-Rights Price of 7.7 pence per Ordinary Share on 4 August 2009 (being the latest practicable day prior this announcement).
The net proceeds of the Rights Issue are intended to be used to resolve the Company's upcoming debt maturities and to allow the Company to take advantage of the attractive buying opportunities which are already beginning to become apparent in the real estate market.
An interim dividend of 3 pence per share for the half year ended 31 March 2009 is payable on 28 September 2009 to Shareholders on the register on 14 August 2009. The payment of the interim dividend is conditional on the completion of the Rights Issue.
In connection with the Rights Issue, the Board is seeking authority from Shareholders to approve a reconstitution of Wichford's share capital to enable the issuance of New Shares at the Issue Price, which is lower than the current nominal value per share of the Existing Shares.
Following the Rights Issue the Board intends to make certain changes to the Board to enhance the existing real estate expertise on the Board.
The Rights Issue is being fully underwritten by Evolution Securities Limited and KBC Peel Hunt Ltd, who are also acting as Joint Sponsors in connection with the Rights Issue.
Philippe de Nicolay, Chairman of Wichford, commented today:
"The Board continues to believe in the strength of Wichford's portfolio, the investment case and the stability of its income stream. While the Company has experienced difficulties in recent months due to prevailing economic conditions, the proceeds of the rights issue will be used to resolve the outstanding issues with our creditors and provide Wichford with capital to make sensible acquisitions at an ideal time in the current market.
I am confident that by partly re-shaping our portfolio, securing our debt and bringing more real estate expertise onto the Board, Wichford will perform to its true potential. I look forward to reporting on the Company's progress later in the year."
Wichford will shortly publish a Prospectus in relation to the Rights Issue. A further announcement will be made in due course.
5 August 2009
Enquiries:
Wichford P.L.C.
Philippe de Nicolay 00 33 1 40 74 42 79
Wichford Property Management Ltd
Philip Cooper 020 7495 7111
Stephen Oakenfull 020 7811 0100
Evolution Securities Limited 020 7071 4300
Tim Worlledge / Jeremy Ellis / Chris Clarke (Corporate Finance)
Chris Sim / Grant Schaffer (Corporate Broking)
KBC Peel Hunt Ltd 020 7418 8900
David Davies / David Anderson / Oliver Stratton (Corporate Finance)
Marianne Woods / Nicholas Marren (Corporate Broking)
Citigate Dewe Rogerson 020 7638 9571 George Cazenove Hannah Dean
Disclaimer
The information contained in this announcement has been prepared by Wichford P.L.C. (the "Company") in connection with a fully underwritten rights issue by the Company. This announcement is not a prospectus or any other kind of financial promotion. This announcement is a summary only and should be used solely for information purposes. This announcement does not constitute or form part of, and should not be construed as, an offer, invitation or inducement to purchase or subscribe for any securities in the Company nor shall it or any part of it form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. This announcement does not take into account any recipient's individual objectives, financial situation or needs and all recipients are expressly warned of the requirement to carry out their own due diligence into the Company and this investment opportunity. Recipients should form their own assessment and take independent professional advice on the merits of investment and the legal, regulatory, tax and investment consequences and risks of doing so. Any decision to purchase securities in any proposed offering should be made solely on the basis of publicly available information and the offering documentation.
The distribution of this announcement and other related documents, including the prospectus, may be restricted in jurisdictions other than the United Kingdom. It is the responsibility of each individual recipient to comply with and observe any restrictions as failure to do so may contravene the securities laws of the relevant jurisdiction.
While all reasonable care has been taken to ensure that the facts stated herein are accurate and that the forecasts, opinions and expectations contained herein are fair and reasonable, in each case at the date stated in this announcement, the Company has not verified the contents hereof and, accordingly, the Company nor any of its directors, officers or employees, shall be in any way responsible for the contents hereof, and no reliance should be placed on the accuracy, fairness or completeness of the information contained in this announcement. No person (including the Company and its directors, employees, shareholders, officers, agents or professional advisers) accepts any liability whatsoever for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith. Past performance information contained in this announcement is not an indication of future performance. Any projections, opinions, forecasts, estimates or projected returns herein constitute a judgement as at the date of this announcement and there can be no assurance that future results or events will be consistent with any such projections, opinions, forecasts, estimates or projected returns. Receipt of this announcement does not imply or create any duty or other obligation on the Company to inform recipients as to any amendments, changes or other modifications relating to matters contained in the announcement.
1. Introduction
Wichford's Board has announced that the Company is proposing to raise £55.8 million (before expenses) by the issue of 929,333,636 New Shares at a price of 6 pence per New Share. The issue is being made by way of a 7 for 1 Rights Issue. The Rights Issue has been fully underwritten by the Underwriters. The Issue Price of 6 pence per New Share represents a 68.8 per cent. discount to the closing middle market price of 19.25 pence per Ordinary Share and a 21.6 per cent. discount to the Theoretical Ex-Rights Price of 7.7 pence per Ordinary Share on 4 August 2009 (being the latest practicable day prior this announcement).
In connection with the Rights Issue, the Board is seeking authority from Shareholders to approve a reconstitution of Wichford's share capital to enable the issuance of New Shares at the Issue Price, which is lower than the current nominal value per share of the Existing Shares.
The purpose of the Rights Issue is to provide the financial resources with which to resolve the Company's upcoming debt maturities in 2010 and to allow the Company to take advantage of the attractive buying opportunities which are already beginning to become apparent in the market. This announcement sets out the background to, reasons for and principal terms of the Rights Issue and explains why the Board considers it to be in the best interests of the Company and its shareholders as a whole.
Further details of the Rights Issue and how Qualifying Shareholders can apply for New Shares are set out in Part II ("Terms and Conditions of the Rights Issue") of the Prospectus and, where relevant, in the Provisional Allotment Letter.
2. Background to and reasons for the Rights Issue
The turmoil that continues to adversely affect global capital markets has had a significant impact on the value and liquidity of many asset classes. The availability of finance for real estate acquisitions and investment has been severely limited, resulting in a decline in the demand for most real estate assets and a consequent decline in property values. In addition, in the United Kingdom and in global economies generally, the economic slowdown in activity has led to a reduction in occupational demand. Whilst the Group is not immune from these broader trends, occupancy and rents in the property portfolio have remained stable, principally due to the Government occupation and average unexpired lease terms in excess of eight years incorporating upward only rent reviews.
The Group continues, given its current net asset and refinancing position, to maintain a portfolio with a stable rent roll and high occupancy rates but has been adversely affected by declining values of property assets and uncertainty in the wider UK economy.
The valuation reports dated 30 June 2009 included in the Prospectus reflect a decline in the value of the Group's UK property portfolio of 1.2 per cent. since the previous valuation date of 31 March 2009. The Group's European portfolio declined 1.0 per cent. in local currency over the same period. No sales or acquisitions were completed in this period.
Between 30 September 2007, when property values generally began to decrease, and 30 June 2009, like-for like values for the unchanged part of the Group's UK property portfolio (i.e. those properties held by the Group over both valuation dates), decreased in value by 28.2 per cent. This compares with capital value declines of 42.9 per cent. for the IPD All Property index and 43.7 per cent. for the IPD All Office index taken from September 2007 to May 2009. The unchanged part of the Group's European property portfolio decreased in value by 30.0 per cent. on a like-for-like basis in local currency over the comparable period.
Principally, as a result of declining property values, Wichford has become significantly leveraged. Moreover, Wichford's ability to extend the maturity of its existing Delta and Gamma debt facilities to the end of their full term (being October 2012), which are secured at terms that are more favourable than could be achieved in today's market, may be compromised.
Wichford is actively pursuing a range of steps to ensure the Company is well placed to successfully refinance existing facilities as they mature, details of which are set out below.
The Delta and Gamma facilities mature in October 2010 but are subject to a two year extension if (among other things) the weighted average unexpired lease term (the "WAULT") of the assets secured by the facilities exceeds a minimum threshold. Since the terms of the Delta and Gamma facilities would be difficult to replicate in the current environment, the Board believes that it would be prudent to seek to meet this minimum WAULT threshold to achieve the extension of the Delta and Gamma facilities before they are tested in October 2010.
Without new equity, increasing the WAULT will only be possible through negotiations with the Delta and Gamma debt servicer (which represents the bondholders of the securitised facilities), negotiations with tenants and swapping assets from and into the relevant Delta and Gamma security pool to change the WAULT profile. The Board considers this strategy to be unattractive due to the earnings dislocation between long dated and short dated leases in the current economic climate as it is likely to result in a reduced rental income. While the WAULT test is over a year away, these alternative strategies will take time to implement and the results are uncertain. It is therefore the Board's desire to raise new capital, which the Board anticipates in combination with these strategies, will enable the Board to increase its options in relation to ensuring the WAULT thresholds are met in 2010.
In addition, strengthening the Group's balance sheet and cash position through the Rights Issue will increase the Group's options in relation to the VBG portfolio. The Company is at risk of breaching its loan to value covenants should the providers of the VBG loan facilities call for a valuation, which they have the right to do at any time. Without the proceeds of the Rights Issue, the Company would still have available to it a range of options to deal with any potential covenant breach in relation to the VBG loan facilities which it would seek to start implementing immediately if the providers of the facilities were to call for a valuation, or at the relevant maturity dates of the facilities, which are January 2010 and April 2011. Such actions include negotiating a maturity extension with the debt servicer, selling VBG, refinancing the VBG facilities on terms which are likely to be less favourable than those currently secured, or negotiating a reduction of the outstanding principal debt amount in return for an equivalent increase in equity contributions. However, as the outcome of such actions are beyond the Company's control, there can be no certainty that they will be successful. In the event that the Company does not achieve an alternative option, the Company may be obliged to inject additional equity into VBG, which is approximately equal to the shortfall between the amount outstanding under the VBG loan facilities and the current value of properties secured thereunder amounting to £20 million.
In addition to strengthening the Group's position in relation to the VGB loan facilities, the proceeds from the Rights Issue should allow the Group to deal with the further issues highlighted below:
2.1 Re-balance the capital structure of Wichford
As at 30 June 2009 Wichford had net indebtedness (bank borrowings less cash) of £482.1 million against a gross property valuation of £534.4 million. This represents a Loan to Value ("LTV") ratio (net of cash) of 90.7 per cent.
The Board of Wichford believes that following the material reduction in property valuations, these relative levels of indebtedness are no longer appropriate for the Group. In keeping with the wider property market, Wichford's Board believes that Wichford's gearing levels need to be reduced.
Furthermore, the Rights Issue will increase Wichford's options in relation to resolving the maturity on the Delta and Gamma facilities (see 2.2 and 2.3 below) which is expected to significantly improve the debt stability of the Company.
2.2 Extend the repayment date of the Delta and Gamma debt facilities of approximately £314.3 million from October 2010 to October 2012
Wichford has two non-amortising debt facilities, Delta and Gamma, and the combined debt outstanding on these facilities as at 30 June 2009 was £314.3 million. The original loan agreements provide that the final repayment date may be extended from October 2010 to October 2012 if the Group can demonstrate that the WAULT of each security pool is at least 7.5 years from October 2012. Based on the existing portfolio the Group will not meet this obligation and would need to repay or refinance the full £314.3 million debt outstanding by October 2010 or enter into negotiations with the loan servicer of the CMBS vehicles.
Under the current lending agreement, neither of these facilities have any ongoing value related covenants. As at 30 June 2009 there was significant headroom on the interest cover ratios which were 146.5 per cent. and 149.8 per cent. for the Delta and Gamma facilities respectively, compared to covenants of 125 per cent. and 115 per cent. respectively. Whilst there is no LTV covenant on these facilities, loan to value ratios on a gross debt basis as at 30 June 2009 were 102.6 per cent. and 100.3 per cent. for the Delta and Gamma facilities respectively. This level is significantly higher than those currently acceptable to lenders in the market. The Board believes that negotiating a refinancing in the current credit market would require substantial new equity and come at a higher interest cost.
The Board believes it is in the best long term interest of the Shareholders, for the capital base to be increased through a rights issue to provide the Group with the required flexibility to amend the security pools of these facilities in order to extend the WAULT and thereby achieve the extension of the maturity dates of these facilities.
Part of the strategy to meet the WAULT includes the sale of certain identified shorter let properties currently in the portfolio in order to limit the amount of new capital required to finance the acquisition of assets with long leases. Five assets have been identified for sale in the near term, one of which was sold on 21 July 2009 and the sale of a further two of which are due to complete on or about the date of this announcement. Agreements for sale have also been exchanged on two other properties which are due to complete in August 2009.
To successfully extend the maturities on these facilities it is estimated that Wichford could deploy proceeds of £30.0 million from the Rights Issue together with the proceeds of sale of certain shorter let properties to purchase additional assets with sufficiently long leases to increase the portfolios' WAULT.
The Board believe that the depth of the property universe in which the Company operates means that executing reasonably large volumes of sales and purchases is achievable given the relative buoyancy of government tenanted assets. Despite competition for long lease assets being significant, the Company has an opportunity to acquire such assets at attractive price points. In this regard, the Company has an established track record of creating sales and purchases.
Wichford would need to ensure asset purchases were capable of satisfying the substitution criteria within the Delta and Gamma facility documents to become part of the security pool. There have already been two such substitutions.
In addition, WPML is already in discussions to renegotiate and extend three of the leases in the existing portfolio. The success of this approach is also dependent on Wichford having sufficient resources to conclude on these negotiations.
WPML has a proven track record of successfully converting short leases into longer term leases which protect and guarantee Wichford's rental income for the future.
2.3 Stronger platform to exploit general market weakness
Due to concern over property values and the shortage of available credit, banks remain reluctant to lend money to finance commercial property transactions which in turn has slowed transaction volumes in the market. Furthermore, banks are charging increased margins on loans, reducing the impact of interest rate cuts. Despite the quality of our tenants and the reliability of our rental streams, the downturn has inevitably impacted Wichford's growth plans.
Following the Rights Issue, Wichford will be in a stronger position to exploit any opportunities to acquire new properties that should further enhance total shareholder return through high income yields and options for capital growth.
In the current market environment it is therefore appropriate for the Group to reduce its level of net indebtedness and strengthen its balance sheet. Your Board believes that the funds raised from the Rights Issue will significantly improve the financial position and future prospects of Wichford, creating a stronger platform from which to drive shareholder value.
3. Information on the Group
3.1 Introduction
Wichford is an Isle of Man registered property investment company with a portfolio focused on UK and Continental European investment property which is primarily occupied by National and State Government bodies. As at 30 June 2009, the Group had 79 properties under management with a gross asset value of approximately £534.4 million generating an annualised rental income of approximately £44.2 million per annum.
The business was set up in September 2003 when the Partnership was originally formed. The Partnership is now wholly owned by the Group. The Ordinary Shares were admitted to trading on AIM in August 2004 and subsequently moved to the Main Market in December 2007.
WPML and BCM have been acting as the Property Adviser and Property Manager respectively to the Partnership from September 2003, when the Partnership was established, and subsequently to Wichford and the subsidiaries.
3.2 History and development of the Company
Prior to admission to AIM in August 2004, the Partnership was restructured so that it became wholly owned by the Group. Wichford is the holding company of the Group, which currently consists of Wichford and the Subsidiaries (which are listed in Part VII of the Prospectus) and between them the Subsidiaries own the legal title to the properties.
The Ordinary Shares were admitted to trading on AIM on 13 August 2004. The Directors believed that enabling the public trading of the Ordinary Shares would aid the raising of substantial additional finance, both equity and debt, for the expansion of the Company's portfolio of properties and would give the Company increased profile and standing with third parties. The Company raised £30 million (before expenses) through the placing of New Shares with institutional and other investors.
The Company made significant progress in the ten months from its admission to trading on AIM, had fully invested the funds raised in August 2004, and on 20 June 2005, the Company announced a placing of New Shares raising £100 million (before expenses). The Directors believed that the continued increase in size of the net assets of the Company would benefit the Company and Shareholders because:
• the increased size of the Company's property portfolio would facilitate the active management of the portfolio in order to capture value enhancement opportunities, including rent reviews, lease extensions and renewals, and property sales;
• it would lead to economies of scale and the improvement of the Company's negotiating position;
• it would potentially provide access to additional financing options which were only available on account of the increased size of the property portfolio, including securitisation of debt or bond issuance;
• it would enhance the net asset value per share of the Company; and
• it would increase analyst interest and coverage of the Company's activities which could also lead to greater liquidity in the market for the Company's Ordinary Shares As approved at the AGM on 31 January 2007, the Company expanded its target market in response to continuing compression of property yields and the rise in UK interest rates. Shareholders approved the Company's policy change to allow the Company to acquire properties in Continental Europe. The Company's investment policy was extended to seek, in addition to properties occupied by UK Central Government bodies, to acquire Central or State Government occupied properties in Continental Europe. It initially targeted properties in France, Germany, the Netherlands and Scandinavia. The Directors decided to enter the Continental European property market for the reasons set out below:
• Euro interest rates were lower than the equivalent in Sterling based interest rates;
• the Directors considered, therefore, that acquisitions in Continental Europe would be more earnings accretive;
• the prevalence of indexation of rents in Continental Europe would mean that the proportion of rental income in the Company's portfolio which was index-linked would increase over time;
• if there was a convergence with the UK market, the net asset value of the Company would, over the longer term, benefit from any yield compression in Continental Europe; and
• an increase in the size of the Company's debt would lead to improved pricing and terms through securitisation or bond issuance.
On 16 February 2007, the Company announced a further fundraising through the placing of New Shares raising £75 million (before expenses) to enable it to continue to expand its UK portfolio and to take advantage of property acquisition opportunities in Continental Europe.
On 15 May 2007, the Company announced its first acquisition in Continental Europe when it signed an agreement to purchase up to 94.9 per cent. of a limited partnership which owned the freehold interest in the Justizzentrum in the town of Halle, near Leipzig, Germany. The entire property is let to the state government of Sachsen-Anhalt, and is used as a court house and as offices for the district attorney. By 30 September 2007, the Company had completed the acquisition of 83.34 per cent. of the interests in the limited partnership which owned that property and had contracted to acquire an additional interest of over 10 per cent. before 31 December 2007, which was duly completed.
On 29 June 2007, the Company acquired a group of companies and limited partnerships which own four buildings located in Berlin, Cologne, Dresden and Stuttgart, Germany. The properties are let to an institution of public law which is effectively an agency of the Federal German Government.
On 14 September 2007, Wichford St. Cloud SCI (a French entity owned by the Company) acquired a property in St. Cloud, France. This property is predominantly let to a State funded training organisation ("association pour la création d'entreprises").
On 28 December 2007, Wichford listed on the London Stock Exchange's Main Market. While AIM provided our business with a strong base during early years as a publicly quoted company, stepping up to the Main Market was a sign of Wichford's growing maturity.
During 2008, Wichford reached agreement to extend the leases on 17 properties occupied by UK Central Government tenants until 2023, linking their rents to the UK consumer price index (CPI). Such deals were attractive to both parties with the tenants obtaining security of tenure and Wichford security of income.
In May 2008, Wichford signed a new three-year loan facility with Lloyds TSB Bank plc for £58.5 million. Given the shortage of bank finance for the commercial property sector, this deal represented a strong vote of confidence in the Company.
In May 2008, Corovest FM, a fund management group with a strong property background, acquired 50 per cent. of WPML, formerly held by Laird Capital Limited.
In July 2008, Wichford completed the acquisition of Haagse Veste1 in The Hague, Netherlands, for a consideration of €35 million. The building is leased to the Royal Dutch Government for use by the International Criminal court. It provides a total net lettable space of approximately 12,350 sq.m. plus 155 car parking spaces. It is let for a term of six years from July 2008 with the tenant's option to extend for a further four years. The initial rent was €2.1 million and is indexed to the Dutch CPI on a yearly basis. The tenant undertook a substantial fit-out programme prior to taking occupancy of the building.
A special resolution was passed by Shareholders at the Annual General Meeting of the Company on 29 January 2009 authorising the Directors to cancel £50 million of the Share Premium account, subject to the approval of the Court in the Isle of Man, in order to provide further flexibility for the Company's financial structure; in particular, and in contrast to the purpose of the Rights Issue, the cancellation of the Share Premium account increased the distributable profits to enable the Company to make future distributions to Shareholders. This cancellation amounted to approximately 29.63 per cent. of the Share Premium account and increased the distributable reserves of the Company. The Court's approval was obtained on 26 March 2009 and registered with the Financial Supervision Commission of the Isle on Man on 30 March 2009.
3.3 The business
Wichford seeks to create sustainable shareholder value by buying properties let to Central and State Government tenants, to extend unexpired lease term and regear short terms leases to secure reliable, index-linked income streams, all of which will support an attractive dividend yield to the Company's investors.
3.4 Investment policy
The Company's investment policy is to invest in properties across the UK and Continental Europe with a focus on properties with Central and State Government occupiers.
Key principles
• The Company will acquire single properties, portfolios of multiple properties or property special purpose vehicles and where appropriate, joint ventures.
• The properties will be held in the long term, but may be disposed of and the funds re-invested if this is believed to be advantageous to the long-term investment income performance of the Company.
• The properties being acquired will have a mixture of short and longer terms to run on the leases typically less than 25 years.
• The Company seeks to acquire properties which have identified alternative uses and/or potential other occupiers.
Investment restrictions
• The Company intends to acquire properties with individual values of not less than £1 million.
• The Company will not acquire any single property unit which has an acquisition value to the Company of greater than 15 per cent. of the value of the Company's investment portfolio.
• The Company will not invest in forward funding a development without a pre-let agreement to lease.
• The Company will not invest in properties where the purchase price is not supported by an external valuation.
• The Company will not invest in properties where there are known to be material environmental issues.
• The Company will not invest in properties in the UK which do not have fully repairing and insuring eases.
In addition, pursuant to the Listing Rules the Company is subject to the following investment restrictions:
• The Company must at all times manage its assets in a way which is consistent with its object of spreading investment risk and is in accordance with the Company's published investment policy.
• The Company and the other members of the Group must not conduct any trading activity which is significant in the context of the Group as a whole.
• No more than 10 per cent. in aggregate, of the value of the total assets of the Company may be invested in other listed closed-ended investment funds.
Gearing
It is the Company's intention to maintain a blended loan to value ratio of between 60 per cent. and a maximum of 85 per cent. Details of the Company's borrowing limits under its Articles of Association are set out below.
The Board may exercise all the powers of the Company to borrow money, to give guarantees, to mortgage, hypothecate, pledge or charge all or any part of the undertaking, property and assets (present and future) and uncalled capital of the Company and, subject to the provisions of the IOM Act and the Articles, to create and issue loan stock and debentures and other securities, whether outright or as collateral security for any debt, liability or obligation of the Company or of any third party.
Provided that the Board shall restrict the borrowings of the Company so as to secure that the aggregate principal amount for the time being of all borrowings by the Company and for the time being owing to persons outside the Company shall not at any time, without the previous sanction of an ordinary resolution of the Company exceed ten times the aggregate of:
• the amount paid up on the issued share capital for the time being of the Company; and
• the total of capital and revenue reserves (including any share premium account, capital redemption reserve, all as shown in the latest balance sheet of the Company).
Investment process
The Directors set the investment policy (subject to Shareholder approval), parameters and objectives of the Company and review and approve each sale or purchase of investment assets. WPML is responsible for identifying and reporting to the Directors the availability of new investment opportunities that fall within the investment policy and objectives. Following the identification of a potential new investment opportunity and approval by the Directors, WPML is responsible for negotiating the terms of investment. It is anticipated that all associated costs and expenses incurred by the Company when acquiring or disposing of properties, portfolios of multiple properties or property special purpose vehicles will be paid for and capitalised by the Company in order to determine the total cost.
Changes to the investment policy
The Company will apply its investment policy to all investments made and held by it. Any material changes to the investment policy of the Company will only be made with the approval of Shareholders by ordinary resolution at a general meeting, which will also be notified via a regulatory information service provider to London Stock Exchange.
If the Company breaches its investment policy (including any investment restrictions), the Company will make a notification via a regulatory information service provider to London Stock Exchange of details of the breach and of actions it may or may have taken.
Investor profile
The Directors expect typical investors in the Company to be primarily UK based fund managers or sophisticated private investors or those acting on the advice of their stockbroker or financial adviser, who are looking to allocate part of their investment portfolio to the UK and Continental European commercial property market.
3.5 Group strengths
Stable earnings
• Stable income stream, due to the majority of tenants being Central or State Government bodies under long term leases with low risk of default.
• 60 per cent. of leases are index-linked upwards only providing further stability to the Group's earnings.
• Unexpired lease length of (8.78 years (as at March 2009)) with an ongoing strategy to renegotiate and extend short leases.
• Occupancy has remained above 99 per cent. in the last four and a half years to 31 March 2009 and has remained stable since 31 March 2009 despite worsening economic conditions.
• High tenant retention; of the four break options available to primary tenants in the last three years, three have remained in occupation.
• Wichford's rents are, in the opinion of the Board, currently relatively low (on average in the 6 months to March 2009 they were £12.20 per square foot). As such volatility in rental values for the Group is low.
• The Group had no bad debts in the six months to 31 March 2009.
Strong track record of value creation
• Proven track record of extending unexpired lease terms; 22 leases extended or breaks removed since 2006. Successful renegotiation and extension of rental leases affords Wichford its secure reliable, index-linked rental income stream.
• Conversion of 18 leases to be indexed-linked or with fixed uplifts.
• Sale of 6 properties at a profit to historical cost.
Dividend distribution
• Earnings from the Group's trading operations remain strong, which will assist in supporting the payment of future dividends.
Resilient property portfolio
• The Group owns and manages a diverse portfolio of properties which were independently valued by the Valuers at £534.4 million as at 30 June 2009. The property portfolio covers a wide geographic spread of the offices in the UK regions, France, Germany and the Netherlands.
• The Company's major tenants by net income are as follows: Job Centre Plus (29 per cent.) Inland Revenue (14 per cent.) and Environment Agency (five per cent.) Courts (four per cent.) Home Office (three per cent.) and Passport Office (three per cent.). Other tenants account for a total of 42 per cent. of net turnover. While the Group is clearly not immune to further valuation falls in the general property market, the nature of the Wichford property portfolio is such that it has not suffered the same valuation falls as the broader UK commercial property market.
• WPML has negotiated loan facilities (other than the VBG and Zeta facilities) without any continuing loan to value covenants. 70.5 per cent. of the Group debt has no LTV covenant.
• The other principal covenants on Wichford's debt facilities are Interest Cover Covenants and WAULT requirements on the Delta facility (of 4.5 years) and Gamma facility (of 6 years) and on the Zeta facility.
High quality and experienced management team
• Board of Directors of the Company of independent experienced non executives for additional corporate governance and monitoring.
• WPML has a team of experienced and skilled professionals. For further details see paragraph 9.6 of Part VII of the Prospectus.
Continued focus on control of operating costs for Wichford
• In addition to the arrangements in relation to WPML's fees, WPML will be approaching key service providers for revised quotes on services currently performed for the Company. In addition, subject to Board approval, cost savings for at least two key service contracts are anticipated within the next 6-12 months.
3.6 Current Strategy
The Board's strategy for managing the Group through the current economic climate is to:
• strengthen the Group's balance sheet through the Rights Issue;
• undertake a series of acquisitions and sales to increase the WAULT in the Delta and Gamma loan facilities that will enable an extension of these facilities to October 2012;
• extend the WAULT with, as far as possible, a limited number of transactions to ensure active management and growth opportunities in the existing portfolio are retained;
• continue to renegotiate and extend the unexpired lease length of the rest of the Group's property portfolio and to secure reliable, index-linked rental income streams;
• maintain high occupancy levels;
• reduce both the overhead and management fee cost base;
• opportunistically exploit acquisitions of Government backed income at historically attractive yields to drive cash distributions and provide capital growth opportunities through active management initiatives;
• explore opportunities to expand into other areas of Government backed income; and
• undertake a detailed capital budgeting process associated with identified active management initiatives.
3.7 Current trading outlook
Since 31 March 2009 there have been further falls in property values generally, both in the UK and Continental Europe, however the rate of decline has slowed substantially in comparison to the six month period to 31 March 2009. Valuation declines in the broader commercial property market have, over the last 3 months, been increasingly driven by declines in rental values, with rental yields showing signs of stabilising.
The Directors believe that the market for long leases remains strong and there is evidence in recent months of prices stabilising and indeed improving. The Board expects rental income to remain robust given the high occupancy levels and a WAULT in excess of 8.7 years (as at March 2009).
Subsequent to 31 March 2009, heads of terms have been agreed for letting 9,696 sqft of vacant space at Osprey House, Redditch which will increase rent by £86,294 p.a. and remove the vacant rates charges currently being incurred on this property.
The Company completed the sale of Britannic Way, Neath on 21 July 2009 and is due to complete on the sales of Saxon House, Worthing and Trentside, Nottingham on or about the date of the Prospectus, in addition, an agreement for sale has been exchanged on Newport Road, Cardiff - all at or above their March 2009 valuations. An agreement for sale has also been exchanged on Jefferson House, Leeds which is due to complete in August 2009. These five sales form part of a larger acquisitions and sales strategy to increase the WAULT under the Gamma and Delta facilities in order to achieve an extension of the facility before October 2010.
Acquisition opportunities are expected to be focussed on the UK market where valuation declines have been sharper and more pronounced than Europe. The Directors believe that opportunities for growth exist through creating long-term secure income from relatively high yielding acquisitions. The Directors consider the Rights Issue proceeds to be fundamental in exploiting opportunities in the market.
3.8 Changes to WPML and the Property Advisers Agreement
Corovest FM has agreed to provide sub-underwriting support for the Rights Issue. One of the conditions to the terms of this support is that Corovest FM acquires majority control of WPML. As a result, Corovest FM and JO Hambro Capital Management Limited (JOHCM) have agreed in principle the sale of JOHCM's 50 per cent. shareholding in WPML. This sale is expected to be completed following the General Meeting on 28 August 2009.
The Company has entered into non-binding heads of terms with WPML (the "Heads of Terms") to amend the Property Advisers Agreement. It is intended that under the revised agreement the services currently provided to the Company by BCM pursuant to the Property Managers Agreement shall instead be provided by WPML (such services to be subcontracted to BCM in respect of sales and acquisitions and to others for property management) and the Property Managers Agreement shall be terminated. In return for the provision of the services, the Company will pay to WPML an asset management fee of 0.5 per cent. (reduced from 0.6 per cent. on the Group's assets excluding cash and 0.3 per cent. on the Group's cash) on the aggregate gross value of the Group's assets (including cash) and a commission of 0.75 per cent. (reduced from 1 per cent. under the Property Managers Agreement) in respect of sales and acquisitions, or 1 per cent. (reduced from 1 per cent. plus agents costs and fees) where BCM acts in a joint agency capacity or incurs sub-agent costs and fees. Wichford shall also pay to WPML an incentive fee calculated on a 3 year rolling basis and payable in Wichford shares. The first 3 year period incentive fee shall be equal to 20 per cent. of the total shareholder returns in excess of 12 per cent. per annum and the incentive fee for all subsequent 3 year periods shall be equal to 20 per cent. of the total shareholder returns in excess of 10 per cent. per annum. Payment of the incentive fee is subject to the total return on Wichford's property portfolio placing it equal to or higher than the top 40 percentile ranking when compared to the universe of property funds measured by IPD in its index for the total return on UK IPD All Office Index for the relevant period in question. The maximum award in the first 3 year period is to be capped at 5 per cent. of Wichford's shares in issue from time to time, and all subsequent annual awards are to be capped at 2.5 per cent. of Wichford's shares in issue from time to time, provided that the performance fee is limited to a maximum of 10 per cent. of the total shares of Wichford in issue over a 10 year period. Where the payment of part or all of the incentive fee would result in WPML, when taken together with any party that WPML is considered to be acting in concert with, holding more than 29.9 per cent. of the issued shares in Wichford, then that part of the incentive fee which would result in WPML and any concert party holding more than 29.9 per cent. of the issued shares in Wichford shall, unless otherwise agreed, be satisfied in cash. Either party will be able to terminate the new property advisers agreement upon one year's notice in writing, such notice not to be served before the expiration of the third anniversary of the new agreement. If the terms of the new property advisers agreement are deemed to require shareholder approval under the Listing Rules a separate circular will be issued to approve the implementation of the Heads of Terms in due course.
4. Principal Terms of the Rights Issue
Pursuant to the Rights Issue the Company is proposing to offer up to 929,333,636 New Shares by way of a rights issue to Qualifying Shareholders other than to Shareholders with a registered address, or resident in, the Excluded Territories or the United States at 6 pence per New Share, payable in full on acceptance by no later than 11.00 a.m. on 22 September 2009. The Rights Issue is expected to raise up to approximately £52.2 million, net of expenses. The Issue Price of 6 pence per New Share represents a 68.8 per cent. discount to the closing middle-market share price on 4 August 2009 (being the latest practicable date prior to the date of this announcement).
In setting the Issue Price, the Directors have considered the price at which the New Shares need to be offered to investors to optimise the success of the Rights Issue and raise a very significant level of equity compared with the current market capitalisation of the Group. The Directors believe that the Issue Price and level of discount to the closing price are appropriate.
The Rights Issue will be made on the basis of:
7 New Shares at 6 pence per New Share for every 1 Existing Share
held by Qualifying Shareholders at the close of business on the Record Date.
Entitlements to New Shares will be rounded down to the nearest whole number and fractional entitlements will not be allotted to Shareholders but will be aggregated and, if possible, issued into the market with the net proceeds ultimately accruing for the benefit of the Company. Holdings of Existing Shares in certificated and uncertificated form will be treated as separate holdings for the purpose of calculating entitlements under the Rights Issue.
The Rights Issue is fully underwritten by the Underwriters pursuant to the Underwriting Agreement. The principal terms of the Underwriting Agreement are summarised in paragraph 19.10 of Part VII of the Prospectus.
The Rights Issue will result in up to 929,333,636 New Shares being issued (representing approximately 700 per cent. of the existing ordinary issued share capital and 87.5 per cent. of the enlarged ordinary issued share capital immediately following completion of the Rights Issue).
The Rights Issue is conditional, inter alia, upon:
(a) the Underwriting Agreement having become unconditional in all respects (save for the condition relating to Admission) and not having been terminated in accordance with its terms;
(b) Admission (nil paid) occurring by no later than 8.00 a.m. on 1 September 2009 (or such later time and/or date as the Underwriters and the Company may agree); and
(c) the passing, without material amendment of the Rights Issue Resolutions.
The New Shares, when issued and fully paid, will rank pari passu in all respects with the Redesignated New Ordinary Shares, including the right to receive dividends or distributions made, paid or declared after the date of the Prospectus save in respect of the dividend to be declared in respect of the period ended 31 March 2009 which will only be payable to holders of Existing Shares on the register at the close of business on 14 August 2009.
Application will be made to the FSA and to the London Stock Exchange for the New Shares to be admitted to the Official List and to trading on the London Stock Exchange's main market for listed securities. It is expected that Admission will occur and that dealings in the New Shares (nil paid) on the London Stock Exchange will commence at 8.00 a.m. on 1 September 2009.
Details of further terms and conditions of the Rights Issue, including the procedure for acceptance and payment and the procedure in respect of rights not taken up, are set out in Part II of the Prospectus and, where relevant, will also be set out in the Provisional Allotment Letter.
Overseas Shareholders should refer to paragraph 8 of Part II of the Prospectus for further information on their ability to participate in the Rights Issue.
5. Use of Proceeds
The Group needs to find solutions to the medium term capital structure and indebtedness of the Group, and the extension of the WAULT of Delta and Gamma portfolios to extend maturity of these facilities to October 2012. The Company intends to use the proceeds of the Rights Issue as follows:
• to create a stronger equity base and reduce levels of indebtedness providing medium term capital structure certainty for Wichford;
• to purchase UK property with long leases with approximately £30 million of the proceeds of the Rights Issue, together with sales proceeds, to increase the WAULT calculated on the Delta and Gamma property portfolios and to extend the repayment dates on the Delta and Gamma facilities to October 2012 in line with the Delta and Gamma agreements. This would also enable the Group to take advantage of current and future attractive pricing opportunities. In addition to the proceeds of the Rights Issue, the Group currently has approximately £35 million of cash balances available and has contracted to sell properties with an aggregate value of approximately £19.8 million. The net cash balances will, and the anticipated sale proceeds are expected to, provide the Group with additional resources to make further selective property purchases to take advantage of current and future attractive pricing opportunities.
• to increase the Group's options in relation to the two VBG loan facilities. The Company is at risk of breaching its loan to value covenants should the providers of the VBG loan facilities call for a valuation, which they have the right to do at any time. Without the proceeds of the Rights Issue, the Company would still have available to it a range of options to deal with any potential covenant breach in relation to the VBG loan facilities which it would seek to start implementing immediately if the providers of the facilities were to call for a valuation, or at the relevant maturity dates of the facilities, which are January 2010 and April 2011. Such actions include negotiating a maturity extension with the debt servicer, selling VBG, refinancing the VBG facilities on terms which are likely to be less favourable than those currently secured, or negotiating a reduction of the outstanding principle debt amount in return for an equivalent increase in equity contributions. However, as the outcome of such actions are beyond the Company's control, there can be no certainty that they will be successful. In the event that the Company does not achieve an alternative option, the Company may be obliged to inject additional equity into VBG, which is approximately equal to the shortfall between the amount outstanding under the VBG loan facilities and the current value of properties secured thereunder amounting to £20 million.
6. Board Composition
The Board believes that to provide further assurance to Shareholders that the benefits of the Rights Issue are maximised, it should enhance the existing real estate expertise on the Board to strengthen its oversight of the management between asset ownership, tenant mix, tenure and funding. The Board believes that such a change in the balance of the Board is appropriate at this time to assist in the Group's strategy to deliver shareholder value. Further details will be announced in due course following the successful completion of the Rights Issue but it is anticipated that the overall size of the Board will not increase as a result of the proposed changes.
7. Dividend policy
Wichford's dividend for the year ended 30 September 2008 was 7.25 pence per share. The Board announces that an interim dividend for Wichford for the half year ended 31 March 2009 will be 3 pence per share payable on 28 September 2009 to Shareholders on the register on 14 August 2009. This has been determined taking into account the earnings of Wichford, the impact of the Rights Issue and the Board's dividend policy. Payment of the dividend for the half year ended 31 March 2009 is conditional on the completion of the Rights Issue.
The New Shares will not rank for the dividend declared in respect of the period ended 31 March 2009 but shall be entitled to receive all dividends or other distributions declared with a record date falling after the date of issue of the New Shares.
The first such distribution will be for the second half of the current financial year, and it is the intention of the Board that this should equate to a yield on the Theoretical Ex-Rights Price (following the issue) of 8 per cent. per annum.* This would be payable in early 2010. Thereafter the Directors intend over time to adopt a broadly progressive dividend distribution policy based on sustainable earnings and cashflow, with total annual distributions divided equally between interim and final dividends. The Directors believe that the Group's existing portfolio provides a solid base for such a dividend policy.
* This forecast relates to dividends only and is not a profit forecast
8. Overseas Shareholders
The attention of the Overseas Shareholders or those persons who are holding Ordinary Shares for the benefit of an Overseas Shareholder (including custodians, nominees, trustees and agents), or who have a contractual or other legal obligation to forward the Prospectus or the Provisional Allotment Letter to such an Overseas Shareholder is drawn to the information on the front cover of the Prospectus and paragraph 8 of Part V of the Prospectus.
9. Effect of the Rights issue
Upon completion of the Rights Issue, the New Shares will represent approximately 87.5 per cent. of the Company's enlarged issued ordinary share capital and the Redesignated New Ordinary Shares will represent approximately 12.5 per cent. of the Company's enlarged issued ordinary share capital.
Qualifying Shareholders who do not take up any of their entitlements to New Shares under the Rights Issue will suffer an immediate dilution of approximately 87.5 per cent. to their interests in the Company as a result of the issue of the New Shares pursuant to the Rights Issue. Even if a Qualifying Shareholder elects to sell his or her unexercised Nil Paid Rights, the consideration he or she receives may not be sufficient to compensate him or her fully for the dilution of his or her percentage ownership of the Company's share capital that may be caused as a result of the Rights Issue.
10. Importance of the Vote
The Rights Issue Resolutions must be passed by Shareholders at the General Meeting in order for the Rights Issue to proceed.
The Company is at risk of breaching its loan to value covenants should the providers of the VBG loan facilities call for a valuation, which they have the right to do at any time. Without the proceeds of the Rights Issue, the Company would still have available to it a range of options to deal with any potential covenant breach in relation to the VBG loan facilities which it would seek to start implementing immediately if the providers of the facilities were to call for a valuation, or at the relevant maturity dates of the facilities, which are January 2010 and April 2011. Such actions include negotiating a maturity extension with the debt servicer, selling VBG, refinancing the VBG facilities on terms which are likely to be less favourable than those currently secured, or negotiating a reduction of the outstanding principal debt amount in return for an equivalent increase in equity contributions. However, as the outcome of such actions are beyond the Company's control, there can be no certainty that they will be successful. In the event that the Company does not achieve an alternative option, the Company may be obliged to inject additional equity into VBG, which is approximately equal to the shortfall between the amount outstanding under the VBG loan facilities and the current value of properties secured thereunder amounting to £20 million.
Furthermore, if the Rights Issue does not proceed it is unlikely that the Company will have sufficient capital to acquire additional properties and thereby achieve the minimum WAULT required to secure a two-year extension to the Delta and Gamma facilities in October 2010. The Company believes that the additional capital required for this purpose is approximately £30 million. In these circumstances the options available to the Company would be to refinance the Delta and Gamma facilities on terms which are likely to be much less favourable than those currently secured, repay the outstanding debt which may result in the Company facing a high level of uncertainty as to whether it would remain a going concern, or negotiate a maturity extension, renegotiate with existing tenants to extend their leases or swap assets from and into the relevant Delta and Gamma security pool.
The Directors therefore consider that the Rights Issue will provide the Group with a significantly stronger capital base and it is therefore important that Shareholders vote in favour of the Rights Issue.
11. Major Shareholders
Each of Oakfield Venture Capital SPC Limited, Coronation Capital Limited, Outward Investments Limited and Ciref plc, which in aggregate are the beneficial holders of 27,678,109 Ordinary Shares, has entered into an irrevocable undertaking in favour of each of Evolution Securities, KBC Peel Hunt and the Company, pursuant to which it has agreed to subscribe in full for its entitlements to Nil Paid Rights pursuant to the Rights Issue.
APPENDIX
Expected Timetable of Principal Events
Each of the times and dates in the table below is indicative only and may be subject to change.
|
Date of announcement of the Rights Issue and the interim dividend for the period ended 31 March 2009 (payment of which is conditional on the completion of the Rights Issue) |
5 August 2009 |
|
Ex-dividend date for the interim dividend for the period ended 31 March 2009 |
12 August 2009 |
|
Record date for the interim dividend for the period ended 31 March 2009 |
14 August 2009 |
|
Record Date for entitlement under the Rights Issue for Qualifying CREST Shareholders and Qualifying Non-CREST Shareholders |
close of business on 26 August 2009 |
|
Latest time and date for receipt of General Meeting forms of proxy |
midday on 26 August 2009 |
|
General Meeting |
midday on 28 August 2009 |
|
Despatch of Provisional Allotment Letters (to Qualifying Non-CREST Shareholders only) |
28 August 2009 |
|
Share Reorganisation record date |
5.00 p.m. on 28 August 2009 |
|
Dealings in New Shares, nil paid, commence on the London Stock Exchange |
8.00 a.m. on 1 September 2009 |
|
Existing Shares marked "ex" by the London Stock Exchange |
8.00 a.m. on 1 September 2009 |
|
Nil Paid Rights credited to stock accounts in CREST (Qualifying CREST Shareholders only)(1) |
as soon as possible after 8.00 a.m. on 1 September 2009 |
|
Nil Paid Rights and Fully Paid Rights enabled in CREST |
8.00 a.m. on 1 September 2009 |
|
Recommended latest time for requesting withdrawal of Nil Paid Rights and Fully Paid Rights from CREST (i.e. if your Nil Paid Rights and Fully Paid Rights are in CREST and you wish to convert them to certificated form) |
4.30 p.m. on 16 September 2009 |
|
Latest time for depositing renounced Provisional Allotment Letters, nil or fully paid, into CREST or for dematerialising Nil Paid Rights or Fully Paid Rights into a CREST stock account (i.e. if your Nil Paid Rights and Fully Paid Rights are represented by a Provisional Allotment Letter and you wish to convert them to uncertificated form) |
3.00 p.m. on 17 September 2009 |
|
Latest time and date for splitting Provisional Allotment Letters, nil or fully paid |
3.00 p.m. on 18 September 2009 |
|
Latest time and date for acceptance, payment in full and registration of renunciation of Provisional Allotment Letters |
11.00 a.m. on 22 September 2009 |
|
Dealings in New Shares, fully paid, commence on the London Stock Exchange |
8.00 a.m. on 25 September 2009 |
|
New Shares credited to CREST stock accounts |
25 September 2009 |
|
Payment date for the interim dividend for the period ended 31 March 2009 |
28 September 2009 |
|
Despatch of definitive share certificates for the New Shares in certificated form |
by no later than 2 October 2009 |
Notes:
(1) Subject to certain restrictions relating to Shareholders with registered addresses outside the United Kingdom, details of which are set out in paragraph 8 of Part II of the Prospectus.
(2) The times and dates set out in the expected timetable of principal events above and mentioned throughout the Prospectus may be adjusted by the Company in consultation with the Joint Sponsors in which event details of the new times and dates will be notified to the FSA, the London Stock Exchange and, where appropriate, Qualifying Shareholders.
(3) References to times in this timetable are to London times.
Definitions
The following definitions apply throughout this announcement, unless the context otherwise requires:
|
"Admission and Disclosure Standards" |
the "Admission and Disclosure Standards" of the London Stock Exchange containing among other things, the admission requirements to be observed by companies seeking admission to trading on the London Stock Exchange's main market for listed securities |
|
"Admission" |
the admission of the New Shares (nil paid or fully paid, as the case may be) to the Official List becoming effective in accordance with the Listing Rules and the admission of such New Shares (nil paid or fully paid, as the case may be) to trading on the London Stock Exchange's main market for listed securities becoming effective in accordance with the Admission and Disclosure Standards |
|
"AIM" |
AIM, a market operated by London Stock Exchange |
|
"Articles" |
the articles of association of the Company as amended from time to time |
|
"BCM" |
Brown Cooper Marples Limited, a private limited company incorporated in the United Kingdom on 7 June 1996 under the Act and registered in England and Wales with registered number 03209028 and having its registered office at 20 Upper Grosvenor Street, London W1K 7PB with telephone number 020 7495 7111 |
|
"Board" or "Directors" |
the Company's directors |
|
"certificated" or "in certificated form" |
recorded on the relevant register of the relevant company as being held in certificated form and title to which may be transferred by means of a stock transfer form |
|
"Company" or "Wichford" |
Wichford P.L.C., a company registered in the Isle of Man with registered number 111198C and having its registered office at Top Floor, 14 Athol Street, Douglas, Isle of Man IM1 1JA |
|
"Core Portfolio" |
UK properties which have lease terms in excess of seven years to expiry or possible lease break date at the tenant's option |
|
"Corovest FM" |
Corovest Fund Managers (UK) Limited |
|
"CREST" |
the system for paperless settlement of trades and holdings of uncertificated shares administered and operated by Euroclear UK & Ireland Limited (formerly called CRESTCo Limited) |
|
"Deferred Shares" |
the Deferred Shares of 9p each in the share capital of the Company created pursuant to the Share Reorganisation |
|
"Euroclear UK" |
Euroclear UK & Ireland Limited |
|
"Evolution Securities" |
Evolution Securities Limited |
|
"Excluded Territories" |
the Republic of South Africa and any other jurisdiction where the extension or availability of the Rights Issue (and any other transaction contemplated thereby and any activity carried out in connection therewith) would breach any applicable law, each an "Excluded Territory" |
|
"Existing Shares" |
the Ordinary Shares in issue at the Record Date |
|
"FSA" |
the United Kingdom Financial Services Authority |
|
"FSMA" |
the United Kingdom Financial Services and Markets Act 2000 (as amended) |
|
"Fully Paid Rights" |
rights to acquire the New Shares, fully paid |
|
"General Meeting" |
the extraordinary general meeting of the Company to be held at at Top Floor, 14 Athol Street, Douglas, Isle of Man IM1 1JA at midday on 28 August 2009 notice of which is set out in the Prospectus |
|
"Group" |
the Company and its subsidiaries and subsidiary undertakings |
|
"IFRS" |
International Financial Reporting Standards |
|
"IOM Act" |
the Companies Acts 1931-2004 (as amended) of the Isle of Man and every statutory modification or re-enactment thereof for the time being in force and, where the context requires, every other statute from time to time in force concerning companies and affecting the Company |
|
"Issue Price" |
6 pence per New Share |
|
"JOHCM" |
J O Hambro Capital Management Limited |
|
"Joint Sponsors" |
KBC Peel Hunt and Evolution Securities |
|
"KBC Peel Hunt" |
KBC Peel Hunt Ltd |
|
"Lehman Brothers" |
Lehman Brothers International (Europe) (in administration) |
|
"Listing Rules" |
the Listing Rules made by FSA under Part VI of FSMA |
|
"London Stock Exchange" |
London Stock Exchange plc |
|
"Memorandum and Articles of Association" |
the memorandum of association and the articles of association of the Company, details of which are set out in paragraph 14 of Part VII of the Prospectus |
|
"New Ordinary Shares" |
the new ordinary shares of 1 pence each in the share capital of the Company to be created pursuant to the Share Reorganisation
|
|
"New Shares" |
929,333,636 New Ordinary Shares to be allotted and issued pursuant to the Rights Issue |
|
"Nil Paid Rights" |
rights to acquire the New Shares, nil paid |
|
"Official List" |
the Official List of the UK Listing Authority |
|
"Ordinary Shares" |
the existing ordinary shares of 10 pence each in the share capital of the Company |
|
"Overseas Shareholders" |
Shareholders with registered addresses outside the United Kingdom or who are citizens or residents of countries outside the United Kingdom |
|
"Partnership" |
Wichford Property Limited Partnership |
|
"£" or "Pounds Sterling" of "Sterling" |
the lawful currency of the United Kingdom |
|
"Property Advisers Agreement" |
a property advisers agreement between the Company (1) and WPML (2) details of which are set out at paragraph 19.11 of Part V11 of the Prospectus |
|
"Property Managers Agreement" |
a property managers agreement between the Company (1) and BCM (2) details of which are set out at paragraph 19.2 of Part VII of the Prospectus |
|
"Prospectus" |
the prospectus, dated 5 August 2009, issued by the Company in connection with the Rights Issue |
|
"Provisional Allotment Letter" |
the renounceable provisional allotment letter expected to be sent to certain Qualifying Non-CREST Shareholders in respect of the New Shares to be provisionally allotted to them pursuant to the Rights Issue |
|
"Qualifying CREST Shareholders" |
Qualifying Shareholders holding Ordinary Shares in uncertificated form |
|
"Qualifying Non-CREST Shareholders" |
Qualifying Shareholders holding Ordinary Shares in certificated form |
|
"Qualifying Shareholders" |
Qualifying Shareholders holding Ordinary Shares in certificated form |
|
"Record Date" |
close of business 26 August 2009 |
|
"Redesignated New Ordinary Shares" |
the Existing Shares following their redesignation into New Ordinary Shares pursuant to the Share Reorganisation |
|
"Registrars" |
Capita Registrars Limited of The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU |
|
"Regulatory Information Service" |
one of the regulatory information services authorised by the UK Listing Authority to receive, process and disseminate regulatory information from listed companies |
|
"Resolutions" |
the resolutions to be proposed at the General Meeting |
|
"Rights" |
rights to the New Shares pursuant to the Rights Issue |
|
"Rights Issue" |
the proposed issue by way of rights of New Shares to Qualifying Shareholders on the basis described in the Prospectus and, in the case of Qualifying Non-CREST Shareholders, in the Provisional Allotment Letter |
|
"Rights Issue Resolutions" |
resolutions 1 to 3 (inclusive) to be proposed at the General Meeting in connection with the Rights Issue, notice of which is set out in the Prospectus |
|
"Shareholders" |
holders of Ordinary Shares |
|
"Share Reorganisation" |
the proposed subdivision of each Existing Share into one New Ordinary Share and one Deferred Share and the subdivision of each unissued Ordinary Share into 10 New Ordinary Shares pursuant to the Rights Issue Resolutions |
|
"Subsidiaries" |
each of the subsidiaries and subsidiary undertakings of the Company, further details of which are set out in paragraph 2.8 of Part VII of the Prospectus |
|
"Takeover Panel" |
the Panel on UK Takeovers and Mergers |
|
"UK Listing Authority" or "UKLA" |
the FSA acting in its capacity as the competent authority for the purposes of Part VI of FSMA in the exercise of its functions in respect of, inter alia, the admission to the Official List of London Stock Exchange including, where the context so permits, any committee, employee, officer or servant to whom any function of the UKLA may for the time being be delegated |
|
"UK" or "United Kingdom" |
the United Kingdom of Great Britain and Northern Ireland |
|
"uncertificated" or "in uncertificated form" |
recorded on the relevant register of the relevant company for the share or security concerned as being held in uncertificated form in CREST and title to which, by virtue of the CREST Regulations, may be transferred by means of CREST |
|
"Underwriters" |
the Joint Sponsors |
|
"Underwriting Agreement" |
the underwriting agreement dated 5 August 2009 between the Company and the Underwriters relating to the Rights Issue and further described in paragraph 19.10 of Part VII of the Prospectus |
|
"VBG" |
Verwaltungs-Berufsgenossenschaft |
|
"WPML" |
Wichford Property Management Limited, a private limited company incorporated on 25 June 2002 in the United Kingdom under the Act and registered in England and Wales with registered number 04469376 and having its registered office at Ground Floor Ryder Court, 14 Ryder Street, London SW1Y 6QB |
Related Shares:
RDI.L