Bassi’s REI issues £15m share offer
PAUL Bassi’s property group Real Estate Investors has announced plans today to raise up to £15m through a new shares issue.
The company says it wants to release up to 272,727,277 new ordinary shares by placing at a price of 5.5p per new ordinary share.
REI is headquartered in Birmingham and specialises in office, retail and residential property and land investment of between £1m and £10m.
The placing is being carried out to allow based REI “to capitalise on opportunities to acquire prime and quality secondary properties” in the West Midlands in what it called a “capital starved market”.
The fresh investment would raise the company’s market capitalisation to nearly £45m with a portfolio of property valued at nearly £60m, it said.
London firm Liberum Capital is acting as broker and Smith & Williamson, which has offices in Birmingham and Worcester, is nominated adviser in relation to the placing.
REI said the placing represented a 55% increase in the number of ordinary shares in issue on the Alternative Investment Market.
The 5.5p price represented a 4.3% discount to the closing mid-market price of 5.75p per ordinary share prevailing on the AIM yesterday, REI said today.
“The directors of REI consider that the company’s existing business model is suited to conversion to a real estate investment trust structure and the board will continue to consider the appropriateness of a conversion to a REIT structure in future,” the firm said in a statement.
“The company has been in discussions in relation to a pipeline of opportunities with an aggregate value of approximately £50m.”
The placing is conditional upon, among other things, the approval of shareholders at a general meeting.
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