Hefty offer for Capital & Regional

Growthpoint Properties, the largest landlord with a primary listing on the JSE, said on Thursday it would offer Capital & Regional shareholders a premium of 100% for their shares as it eyes a controlling stake in the UK shopping-centre owner.

Growthpoint will pay 33p (R6.29) per share to acquire about 30.3% of Capital & Regional – a 100% premium to the latter company’s share price as of September 10.

Growthpoint would then subscribe to acquire 311 million new Capital & Regional shares at 25p (R4.76) per share, which would then leave Growthpoint holding about 51.2% of the company.

The UK is an attractive investment destination, despite the uncertainty posed by Brexit, said Growthpoint. The transaction is expected to be complete by the end of 2019.

The share subscription will provide Capital & Regional with about £77.9m (R1.5bn) in new funds.

Capital & Regional, which has a primary listing on the London Stock Exchange and a secondary listing on the JSE, specialises in shopping centres that dominate their catchment areas.

Capital & Regional chair Hugh Scott-Barrett said on Thursday the board had unanimously recommended the proposed transaction.

“Not only does it provide a liquidity event for shareholders at a significant premium to the company’s share price before this announcement, it also delivers a cash injection of about £77.9m that derisks the business and provides a long-term foundation for growth,” he said in the statement.

At 9.30am on Thursday, Capital & Regional had surged 13.43% to R4.56, having risen 47% since September 10.

Growthpoint’s share price had added 0.7%, to R23.01, on Thursday morning.

The UK is an attractive investment destination, despite the uncertainty posed by Brexit Growthpoint