LONDON (Alliance News) - Retail property specialists Capital & Regional PLC Friday said it plans to increase its holdings in the Mall Fund to 91.82% by acquiring Aviva PLC's 52.04% stake and Karoo Investment Fund's 10.52% stake in a deal worth GBP213 million, partially funded by a placing and open offer of new Capital & Regional shares.
The Mall Fund consists of shopping centres in Blackburn, Luton and Wood Green, London. Capital and Regional currently holds at 29.26% stake in the portfolio.
Capital & Regional said the acquisition will be funded by available cash and debt funding and by a sale of new shares to raise around GBP165 million through the issue of 351.1 million shares at 47 pence per share.
The offer price of 47 pence represents a 2.1% discount to the closing price on Thursday. Capital & Regional shares were quoted unchanged at 48.00 pence Friday afternoon.
The company said 70.3 million of the new shares will be issued through a firm placing at the offer price to raise GBP33.0 million, representing 20% of the capital raising. In addition, 280.8 million new shares will be issued through a placing and open offer at the offer price to raise gross proceeds of around GBP132.0 million, representing the remainder of the capital raising.
At the end of December, the Mall Fund had gross assets of GBP832.4 million and revenue of GBP77.4 million.
JP Morgan Cazenove and Numis Securities will act as joint bookrunners.