IREIT Global UD1U is seeking to raise gross proceeds of around $75.9 million via a preferential offering.
The proceeds will be used to mainly fund the acquisition of the 17 retail properties located across France. IREIT announced the acquisition of the properties on June 1. The acquisition will cost the REIT a total of EUR90.9 million ($133.1 million) including fees and taxes.
Through its preferential offering, the REIT will offer up to 186.10 million units to its existing unitholders at a preferential offering ratio of 161 preferential offering units for every 1,000 existing units. The preferential offering units will be offered at an issue price of 40.8 cents apiece, representing a discount of 9.6% to the volume weighted average price (VWAP) of 45.15 cents per unit on June 19.
The REIT’s joint sponsors, Tikehau Capital and City Developments Limited C09 (CDL), have irrevocably undertaken to subscribe each of their pro-rata allotment in full. CDL’s wholly-owned subsidiary, City Strategic Equity Pte. Ltd. (CSEPL), has also further undertaken to subscribe for excess units in the preferential offering such that its total subscriptions will amount to a maximum of $40.0 million.
Overall, the REIT’s joint sponsors and manager have pledged to subscribe up to a maximum of approximately $62.1 million or 81.8% of the preferential offering. CSEPL will rank last in the allocation of excess unit applications in the preferential offering.
RHB Bank Berhad (Singapore) has been appointed as the sole lead manager and underwriter for the preferential offering.
See also: Changes in ICR, leverage to come into effect immediately, with additional disclosures in March
“Our preferential offering presents an opportunity for our unitholders to further participate in IREIT’s growth. The preferential offering is expected to increase market capitalisation by approximately 14.4% to $601.9 million, enhancing the probability of inclusion in key equity indices. This offers benefits of a wider and more diversified investor base, higher trading liquidity, increased analyst coverage and potential positive re-rating,” says Louis d’Estienne d’Orves, CEO of the manager.
“Our joint sponsors, Tikehau Capital and City Developments, continue to play a pivotal role in our portfolio diversification strategy implemented since 2019 by supporting our preferential offering, further enhancing IREIT’s portfolio and income resiliency for the benefit of all our unitholders,” he adds.
Units in IREIT closed 0.5 cents lower or 1.09% down at 45.5 cents on June 19.
