PROPOSED ISSUE OF EQUITY

RNS Number : 4432S

Empiric Student Property PLC

08 July 2015

 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO, THE UNITED STATES OF AMERICA, CANADA, JAPAN, AUSTRALIA OR SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THIS ANNOUNCEMENT OR ANY COPY OF IT.

THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND NOT A PROSPECTUS. THIS ANNOUNCEMENT DOES NOT CONSTITUTE OR FORM PART OF, AND SHOULD NOT BE CONSTRUED AS, ANY OFFER FOR SALE OR SUBSCRIPTION OF, OR SOLICITATION OF ANY OFFER TO BUY OR SUBSCRIBE FOR, ANY SHARES IN THE COMPANY OR SECURITIES IN ANY OTHER ENTITY, IN ANY JURISDICTION, INCLUDING THE UNITED STATES, NOR SHALL IT, OR ANY PART OF IT, OR THE FACT OF ITS DISTRIBUTION, FORM THE BASIS OF, OR BE RELIED ON IN CONNECTION WITH, ANY CONTRACT OR INVESTMENT DECISION WHATSOEVER, IN ANY JURISDICTION. THIS ANNOUNCEMENT DOES NOT CONSTITUTE A RECOMMENDATION REGARDING ANY SECURITIES. ANY INVESTMENT DECISION MUST BE MADE EXCLUSIVELY ON THE BASIS OF THE PROSPECTUS PUBLISHED BY THE COMPANY.

8 July 2015

Empiric Student Property plc

("ESP" or the "Company" or, together with its subsidiaries, the "Group")

PROPOSED ISSUE OF EQUITY

The Board of Directors of Empiric Student Property plc (LSE: ESP) announces that it is seeking to raise a target amount of £50 million (before expenses) ⁽¹⁾ through an institutional placing (the "Placing") and offer for subscription (the "Offer for Subscription") of new ordinary shares at a price of 105.75 pence per share ("Issue Price") (the "Issue"). 

A new securities note and summary (the "Securities Note" and the "Summary") containing full details of the Issue is expected to be published later today.  The Securities Note and Summary, together with the registration document published on 30 October 2014 and the supplementary prospectus published on 19 May 2015, form the prospectus (the "Prospectus") in relation to the proposed issue of up to 300 million new Shares through a Share Issuance Programme valid until 29 October 2015 (the "Share Issuance Programme").  The Issue will comprise a further tranche under the Share Issuance Programme, under which the Company has to date issued 147.9 million Shares.

The Company's Property Portfolio currently comprises 3,503 beds across 40 assets in 20 cities, 31 of which are standing or forward committed assets and nine are forward funded or development assets.  In addition, contracts have been exchanged to acquire a further development asset comprising 131 beds, conditional on receiving planning consent.

The Company has substantially fully committed the net equity proceeds from the March 2015 fundraising, together with associated debt, into 21 property acquisitions totalling 1,793 beds.  15 of these acquisitions comprise fully let standing assets, two are forward committed assets with rental guarantees in place for 2015/16 and four are forward funded or development assets where the Company expects to achieve an attractive yield on cost through the development phase.  Acquisitions in Aberdeen, Bristol, Exeter, Glasgow, Huddersfield and Leeds have increased the Company's existing presence in these cities in line with its "city clustering" strategy which is expected to deliver significant operational cost savings through economies of scale. 

The Company has a very strong pipeline comprising a mix of operating properties and properties under development across multiple locations in the UK representing, in aggregate, over 2,300 beds.  Accordingly, the Company expects to commit the net proceeds of the Issue by the end of the third quarter of 2015.

The Company currently has drawn debt facilities of £90.3 million, representing 26.9 per cent. of gross asset value as at 31 May 2015.  In addition, the Company has an undrawn debt facility of £20.0 million which it expects to draw down in the near term.  The Company is in negotiations to secure additional bank facilities in order to assist in financing the current pipeline as described above.

Note:

(1) The Directors have reserved the right, in consultation with Jefferies, to increase the size of the Issue up to a maximum of approximately £75 million, with any such increase being announced through a Regulatory Information Service.

Dividends

The Company has today declared a final interim dividend of 1.0 pence per Ordinary Share in respect of the quarter ended 30 June 2015 payable on or around 4 August 2015 to Ordinary Shareholders on the register on 17 July 2015. As a result, the Company will have paid total dividends of 4.0 pence per Ordinary Share in its first financial year.

The Company confirms an annual dividend target of at least 6 pence per Share for the financial year commencing 1 July 2015. Thereafter, dividends are expected to grow by not less than the RPI inflation index ⁽²⁾. The Company's stated intention is to pay these dividends on a quarterly basis.  Shares subscribed pursuant to the Issue will rank in full for dividends payable in the financial year commencing 1 July 2015 (but will not rank for the final interim dividend for the quarter ended 30 June 2015 declared today).

Note:

(2) The target dividends stated above are targets only and not profit forecasts. There can be no assurance that these targets will be met and they should not be taken as an indication of the Company's expected or actual future results. Potential investors should not place any reliance on these targets and any investment decision should be made exclusively on the basis of the Prospectus.

Unaudited Net Asset Value and Valuation

The Company's unaudited Net Asset Value per ordinary share as at 31 May 2015 is 104.6 pence. This represents an increase of 5.2 per cent. as compared to the unaudited Net Asset Value as at 31 December 2014 of 99.4 pence.  For the purposes of calculating the unaudited Net Asset Value, the Company's Property Portfolio has been independently valued as at 31 May 2015.

Expected Timetable

Placing and Offer for Subscription opens	8 July2015
Latest time and date for receipt of completed Offer for Subscription Application Forms and payment in full under the Offer for Subscription	11.00 a.m. on 22 July 2015
Latest time and date for receipt of placing commitments under the Placing	3.00 p.m. on 22 July 2015
Announcement of the results of the Issue	23 July 2015
Admission of the Shares to the Official List and to trading on the London Stock Exchange's main market for listed securities	8.00 a.m. on 27 July 2015
Crediting of CREST stock accounts	27 July 2015
Share certificates despatched (where appropriate)	week commencing 27 July 2015 (or as soon as possible thereafter)

The dates and times specified in this announcement are subject to change without further notice. All references to times in this announcement are to London time unless otherwise stated. In particular, the Board may, with the prior approval of Jefferies and Akur, bring forward or postpone the closing time and date for the Issue. In the event that such date is changed, the Company will notify investors who have applied for Shares of changes to the timetable either by post, by electronic mail or by the publication of a notice through a Regulatory Information Service.

Dealing codes

Ticker	ESP
ISIN for the Ordinary Shares	GB00BLWDVR75
SEDOL for the Ordinary Shares	BLWDVR7

Further details of the Issue and the Share Issuance Programme will be set out in the Securities Note and Summary which are expected to be published today and will be available on the Company's website at www.espreit.co.uk.

Any defined terms used in this announcement are as set out in the Prospectus.

For further information on the Company, please contact:

Empiric Student Property plc	(via Newgate below)
Paul Hadaway (Chief Executive)
Tim Attlee (Chief Investment Officer)
Michael Enright (Chief Financial Officer)
Akur Limited (Joint Financial Adviser)	Tel: [phone]
Tom Frost
Anthony Richardson
Siobhan Sergeant
Jefferies International Limited (Sponsor, Joint Financial Adviser and Sole Global Coordinator and Bookrunner)	Tel: [phone]
Gary Gould
Stuart Klein
Newgate (PR Adviser)	Tel: [phone]
James Benjamin	Em: [e-mail]
Sara Hourigan
Andre Hamlyn

Further information on Empiric can be found on the Company's website at www.espreit.co.uk.

Notes:

Empiric Student Property plc (incorporated in England & Wales) is an internally managed real estate investment trust ("REIT") investing in modern, direct-let, premium student accommodation, both standing and development assets, with a focus on quality and with assets generally in prime central locations in top university cities and towns in the UK.  The Company listed on the premium listing segment of the Official List of the Financial Conduct Authority and was admitted to trading on the main market for listed securities of the London Stock Exchange in June 2014. 

IMPORTANT NOTICE

This announcement is not for publication or distribution, directly or indirectly, in or into the United States (including its territories and possessions, any state of the United States and the District of Columbia), Australia, Canada, South Africa, New Zealand or Japan. The distribution of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

This announcement does not contain or constitute an offer for sale of, or the solicitation of an offer or an invitation to buy or subscribe for, Shares to any person in the United States, Australia, Canada, South Africa, New Zealand or Japan or in any jurisdiction to whom or in which such offer or solicitation is unlawful.

The Company will not be registered under the US Investment Company Act of 1940, as amended. In addition, the Shares referred to herein have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act") or under the securities laws of any state or other jurisdiction of the United States and may not be offered or sold in the United States or to or for the account or benefit of US persons absent registration or an exemption from the registration requirements of the Securities Act and in compliance with any applicable State securities laws. There will be no public offer of the Shares in the United States, Australia, Canada, South Africa, New Zealand or Japan.

The offer and sale of Shares referred to herein has not been and will not be registered under the applicable securities laws of any state, province or territory of Australia, Canada, South Africa, New Zealand or Japan. Subject to certain exceptions, the Shares referred to herein may not be offered or sold in Australia, Canada, South Africa, New Zealand or Japan or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada, South Africa, New Zealand or Japan.

Jefferies and Akur are authorised and regulated by the Financial Conduct Authority. Each of Jefferies and Akur are acting exclusively for the Company and no-one else in connection with the Issue and the Share Issuance Programme.  They will not regard any other person as their respective clients in relation to the subject matter of this announcement and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, nor for providing advice in relation to the contents of this announcement or any transaction, arrangement or other matter referred to herein.

None of the Company, Jefferies, Akur and any of their respective affiliates accepts any responsibility or liability whatsoever for/or makes any representation or warranty, express or implied, as to this announcement, including the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of the announcement or its contents or otherwise arising in connection therewith. The Company, Jefferies, Akur and their respective affiliates accordingly disclaim all and any liability whether arising in tort, contract or otherwise which they might otherwise have in respect of this announcement or its contents or otherwise arising in connection therewith.

 

END

 

 

IOELLFSADDIDIIE