Big shed specialist targets £200m fundraising to finance continuous growth
Big shed specialist, Tritax Big Box, has unveiled plans for a £200m funding to support the ongoing growth of the business.
The REIT, which is behind the two of the biggest commercial warehouse schemes in the Midlands, hopes the new share placing will appeal to investors.
The trust has said it is aiming to complete the new Gestamp automotive stampings facility in Staffordshire by July, followed by the completion of the Screwfix warehouse in Fradley in October.
In its latest market update, the trust said it hoped to use the net proceeds of the share issue to acquire further investments.
The company said it was currently in talks with the owners of a number of “attractive investment assets” that meet its investment criteria and are available for potential acquisition in the near term.
“The directors consider that these investment opportunities are likely to be value accretive to investors over the medium term,” it said.
“Accordingly, the company is seeking to raise a target amount of £200m (before expenses) that will provide the company with funds to capitalise on these investment opportunities.”
The shares issue, which is for 147,058,823 new shares, is based on an offer price of 136p per share.
“The net proceeds of the issue will be used to make additional investments in accordance with the company’s investment criteria, further diversifying the company’s portfolio in terms of both tenant exposure and geographical location and capitalising on the company’s leading position in the UK Big Box logistics market,” it said.
Increasing the size of the company could also improve liquidity and enhance the marketability of the company’s shares, resulting in a broader investor base over the longer term, it added.
Of the potential targets, the trust said is was in advanced negotiations in regard to three standing assets – two of which are under offer – for an aggregate price of approximately £155m.
It said that taking into account these three assets and the commitment to two Howdens Forward Funded Developments, the company is likely to have invested the geared equity proceeds from the October 2016 equity issue.
“There can be no certainty that the company will complete these acquisitions, or that the company will complete any of the transactions in its investment pipeline. It is, however, possible that contracts may be exchanged on one or more of the three assets in the coming weeks and this may occur before, or shortly after, admission,” it added.