Proposal to raise additional equity capital

RNS Number : 0979M

Target Healthcare REIT Limited

20 August 2013

 



TARGET HEALTHCARE REIT LIMITED

RNS ANNOUNCEMENT

20 August 2013

Proposal to raise additional equity capital

Following its successful launch in March of this year, Target Healthcare REIT Limited (the "Company") has acquired a portfolio of seven care homes across England and Scotland which, as at 30 June 2013, had a market value of approximately £32 million.  The initial yield of the portfolio is 7.32 per cent. and, in accordance with its stated dividend policy, the Company has declared its first interim dividend to shareholders of 2p per ordinary share in respect of the four month period from launch to 30 June 2013 which will be paid on 30 August 2013. 

Since launch the Company has also issued a further 9.99 per cent. of its issued share capital by way of a £4.6 million share issue in June 2013.  The Investment Adviser is currently in advanced discussions, or has entered into exclusivity arrangements, in respect of a number of further acquisition opportunities in line with its investment policy.  If completed, these opportunities would result in the Company having invested its remaining available cash reserves in line with the anticipated investment schedule.  The Investment Adviser has also identified further attractive acquisition opportunities.

Accordingly, the Board is pleased to announce that it is discussing with its advisers a proposal to raise additional equity by means of a placing of new ordinary shares at a price which would not be dilutive to existing Shareholders.  The Board anticipates that it will shortly convene a general meeting to authorise the Directors to allot on a non pre-emptive basis, in addition to any existing authority, up to 150 per cent. of the existing issued share capital of the Company.

The Board believes that raising additional equity capital will allow the Investment Adviser to take advantage of the acquisition opportunities it has identified.  The Board also believes that it is in the best interests of shareholders to increase the size of the Company to spread the fixed costs over a wider asset base and to increase the market capitalisation and liquidity in the shares of the Company.  

If the Board and its advisers identify sufficient investor demand, the Company will publish a prospectus shortly following the general meeting of the Company.

All enquiries:

Kenneth MacKenzie

Target Advisers LLP                                                                  

01786 406 581              

Graeme Caton

Winterflood Securities Limited

020 3100 0268

Martin Cassels

R&H Fund Services Limited                                                       

0131 524 6140

 

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