Private placement to raise £13m

SIRIUS Real Estate, which owns and operates a portfolio of branded business parks in Germany and has a secondary listing on the JSE’s main board, has launched a private placement of 25.9 million new ordinary shares to a single British institution to raise about £13 million (R205m). The proceeds of the placement will be invested in the company’s acquisition programme. The placing price will be 50 pence (R7.95) a share, which is a premium to adjusted net asset value of 6.95 percent and a discount of 3.8 percent to the company’s closing mid-market price of 52p (R8.27) a share on Monday. The private-placement shares represent about 3 percent of Sirius’s issued ordinary share capital prior to the placement. Following the issue of the private-placement shares, the total number of voting rights in the company will be 877.78 million. Sirius chief executive Andrew Coombs said the announcement of the private placement stemmed from significant demand from a particular institution that Sirius was delighted to welcome to the company’s register. Coombs said that, as a result, Sirius intended to pull forward the completion of its acquisition of a building in Cologne and accelerate its investment programme with certain assets in the pipeline ahead of the completion of the disposal of the Rupert Mayer Strasse business park in Munich for €5.9 million (R80.7m). The 20 342m², predominantly office building in Cologne is being acquired for a total of €22.9 million (R313m). The disposal of the Rupert Mayer Strasse business park was prompted by the company’s strategy to dispose of mature non-core assets and recycle equity into assets with greater value opportunities to increase total returns from the portfolio. Coombs said the German property market was benefiting from an increase in activity, which was driven by a number of economic and political factors, as well as the continuing favourable lending conditions. “We are seeing a strong flow of sites that fit within our specialist area of expertise and where we are confident of adding significant value,” he said. – Roy Cokayne CARTRACK