Proposed Capital Raise

RNS Number : 8338B

Ground Rents Income Fund PLC

12 January 2015

 

THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA, THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF IRELAND OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A BREACH OF THE RELEVANT SECURITIES LAWS OF SUCH JURISDICTION.

12 January 2015

Ground Rents Income Fund plc

Proposed Capital Raise

Ground Rents Income Fund plc ("GRIF" or the "Company") announces that it intends to raise up to £9 million (before expenses) through the issue of up to 8,451,428 new ordinary shares of 50p each ("New Ordinary Shares"), representing up to 10 per cent. of the Company's ordinary issued share capital at the date of this announcement.

Proposed Capital Raise

The proposed capital raise will be by way of a placing (the "Issue"), which will be made to qualifying investors* through the Company's corporate broker, Nplus1 Singer Advisory LLP ("N+1 Singer"). The Issue is conditional on the passing of resolutions 5 and 6 contained in the notice of the Company's forthcoming Annual General Meeting to be held on 20 January 2015, which, if passed, will grant the directors the appropriate authorities to issue the New Ordinary Shares pursuant to the Issue.

* As defined in section 86(7) of the Financial Services and Markets Act 2000 (as amended).

Use of proceeds

The Issue will enable GRIF to complete a pipeline of investments including a number of option agreements that have been entered into by Brooks Macdonald Funds Limited, as Investment Adviser, on behalf of the Company. This would provide shareholders with further high-quality, income-producing assets. 

The Company has also agreed a short term debt facility of up to £5m, to fund working capital and the exercise of a number of option agreements over assets currently under construction, which have been agreed over the last 12 months.

Details of the Issue

The Issue will be non pre-emptive and will be launched immediately following this announcement, when N+1 Singer will commence a bookbuilding process to determine the level of demand from potential investors for participation in the Issue.

The issue price will be 107 pence, being at a 2.6 per cent. premium to the last reported audited NAV of 104.3 pence per share as at 30 September 2014 (as announced on 4 December 2014) and will rank for the dividend for the period commencing 1 January 2015.

The bookbuild is expected to close at noon (London time) on 23 January 2015 but may be closed earlier or later at the discretion of the Company and N+1 Singer. The final number of New Ordinary Shares to be issued will be agreed between N+1 Singer and the Company following close of the bookbuild, and announced shortly thereafter. 

Subject to the above, N+1 Singer may choose to accept bids, either in whole or in part, on the basis of allocations determined in agreement with the Company, and may scale down any bids for this purpose on such basis as the Company and N+1 Singer may determine. N+1 Singer may also, notwithstanding the above and subject to the prior consent of the Company: (i) allocate New Ordinary Shares after the time of any initial allocation to any person submitting a bid after that time, and (ii) allocate New Ordinary Shares after the bookbuild has closed to any person submitting a bid after that time. The Company reserves the right to reduce the amount to be raised pursuant to the Issue.

Under the terms of the Issue, GRIF intends to issue up to a maximum of 8,451,428 New Ordinary Shares on a non pre-emptive basis, conditional on resolutions 5 and 6 contained in the notice of the Company's forthcoming AGM to be held on 20 January 2015 being passed, which will grant the directors the appropriate authorities to issue the New Ordinary Shares pursuant to the Issue. The Board, in consultation with N+1 Singer, may also decide not to proceed with the Issue for any reason. In this case, an announcement will be made by the Company.

Application for listing and admission to trading

Application will be made to the Channel Islands Securities Exchange Authority Limited (CISEA) for the New Ordinary Shares to be admitted to the Official List of the CISEA and to trading on the SETSqx platform of the London Stock Exchange plc (together, "Admission"). It is expected that Admission will become effective on or around 30 January 2015 and that dealings in the New Ordinary Shares will commence at that time.

For further information:

Brooks Macdonald Funds Limited Simon Wombwell / James Agar	020 7499 6424
N+1 Singer James Maxwell / Emily Watts - Corporate Finance Alan Geeves / Sam Greatrex - Sales	020 7496 3000
Appleby Securities (Channel Islands) Limited Kate Storey	01481 755600
Tavistock Jeremy Carey / James Whitmore	020 7920 3150

Notes to Editors:

Ground Rents Income Fund plc is a listed real estate investment trust (REIT) investing in UK ground rents with a value of £67 million as at 30 September 2014. The company, which listed in August 2012, seeks to generate consistent income returns for shareholders by investing in a diversified portfolio of ground rents including freeholds and head leases of residential, retail and commercial properties located in the UK.

Important Information

The statements contained in this announcement that are not historical facts are "forward-looking" statements. These forward-looking statements are subject to a number of substantial risks and uncertainties, many of which are beyond the Company's control and actual results and developments may differ materially from those expressed or implied by these statements for a variety of factors. These forward-looking statements are statements based on the Company's current intentions, beliefs and expectations about, among other things, the Company's results of operations, financial condition, prospects, growth, strategies and the industry in which the Company operates. Forward-looking statements are typically identified by the use of forward-looking terminology such as "believes", "expects", "may", "will", "could", "should", "intends", "estimates", "plans", "assumes" or "anticipates" or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy that involve risks and uncertainties. By their nature, forward-looking statements involve risks and uncertainties, because they relate to events and depend on circumstances that may or may not occur in the future. In addition, from time to time, the Company or its representatives have made or may make forward-looking statements orally or in writing. Furthermore, such forward-looking statements may be included in, but are not limited to, press releases or oral statements made by or with the approval of an authorised executive officer of the Company. No assurance can be given that such future results will be achieved; actual events or results may differ materially from those expressed in or implied by these statements as a result of risks and uncertainties facing the Company and its subsidiaries. Many of these risks and uncertainties relate to factors that are beyond the Company's ability to control or estimate precisely, such as changes in taxation and fiscal policy, future market conditions, currency fluctuations, the behaviour of other market participants, the actions of governmental regulators and other risk factors such as the Company's ability to continue to obtain financing to meet its liquidity needs, changes in the political, social and regulatory framework in which the Company operates or in economic or technological trends or conditions, including inflation and consumer confidence, on a global, regional or national basis. Such risks and uncertainties could cause actual results to vary materially from the future results indicated, expressed or implied in such forward-looking statements. The forward-looking statements contained in this announcement speak only as of the date of this announcement and the Company undertakes no duty to update any of them publicly in light of new information or future events, except to the extent required by applicable law.

This announcement is for information purposes only and shall not constitute an offer to buy, sell, issue, or subscribe for, or the solicitation of an offer to buy, sell, issue, or subscribe for any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. This announcement has been issued by and is the sole responsibility of GRIF.

No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Nplus1 Singer Advisory LLP, or by any of its affiliates or agents as to, or in relation to, the accuracy or completeness of this announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.

Nplus1 Singer Advisory LLP, which is authorised and regulated in the United Kingdom by the FCA, is acting for GRIF and for no-one else in connection with the Issue, and will not be responsible to anyone other than GRIF for providing the protections afforded to clients of N+1 Singer nor for providing advice to any other person in relation to the Issue or any other matter referred to herein.

The distribution of this announcement and the offering of the New Ordinary Shares in certain jurisdictions may be restricted by law. No action has been taken by GRIF or N+1 Singer that would permit an offering of such shares or possession or distribution of this announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this announcement comes are required by GRIF and N+1 Singer to inform themselves about, and to observe such restrictions.

The price of shares and the income from them may go down as well as up and investors may not get back the full amount invested on disposal of the shares.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS DIRECTED ONLY AT PERSONS WHO ARE: (A) (I) INVESTMENT PROFESSIONALS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER"), OR (II) PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC") OF THE ORDER, OR (III) PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED; AND (B) (I) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED INVESTORS (AS DEFINED IN ARTICLE 2(1)(E) OF EU DIRECTIVE 2003/71/EC (THE "PROSPECTUS DIRECTIVE")), AND/OR (II) PERSONS IN THE UNITED KINGDOM WHO ARE QUALIFIED INVESTORS (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS ANNOUNCEMENT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN GROUND RENTS INCOME FUND PLC.

This announcement is not for distribution, directly or indirectly, in or into or from the United States (including its territories and possessions, any state of the United States and the District of Columbia), Canada, Australia, the Republic of South Africa, the Republic of Ireland or Japan or any jurisdiction into which the same would be unlawful (each a "Restricted Jurisdiction"). This announcement does not constitute or form part of an offer or solicitation to purchase or subscribe for shares in the capital of GRIF in a Restricted Jurisdiction. In particular, the New Ordinary Shares referred to in this announcement have not been, and will not be, registered under the US Securities Act of 1933 (as emended) ("Securities Act") or under the securities legislation of any state of the United States, and may not be offered or sold in the United States absent registration or pursuant to an exemption from, or in a transaction not subject to, the registration requirements under the Securities Act. Subject to exceptions, the New Ordinary Shares referred to in this announcement are being offered and sold only outside the United States in accordance with Regulation S under the Securities Act. The New Ordinary Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into or from a Restricted Jurisdiction.

Neither the content of GRIF's website nor any website accessible by hyperlinks on GRIF's website is incorporated in, or forms part of, this announcement.

 

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