Vuk­ile beats tar­get in cap­i­tal rais­ing

The Star Early Edition - - COMPANIES - Sandile Mchunu

VUK­ILE Prop­erty Fund, the listed real es­tate in­vest­ment trust (Reit), said yes­ter­day that it had man­aged to raise R900 mil­lion through the plac­ing of 48 066 103 new shares.

The com­pany had in­tended to raise R500m through an ac­cel­er­ated book build. The group man­aged to achieve and beat its tar­get by R400m in less than seven hours of open­ing the book build.

“In light of strong de­mand, the amount of cap­i­tal raised was in­creased from R500m to R900m through the plac­ing of an ag­gre­gate of 48 066 103 new shares. The book was sig­nif­i­cantly over­sub­scribed, even at R900m,” the fund said.

Of the R900m cap­i­tal raised, R578.75m was raised pur­suant to the ac­cel­er­ated book build process at R18.80 a share, R71.25m by way of place­ment with man­age­ment at R18.80 a share and R250m by way of place­ment with the En­cha SPV at R18.53 a share in terms of the En­cha eq­uity fund­ing plat­form ar­range­ments as de­tailed in Vuk­ile’s cir­cu­lar is­sued on June 5, 2013.

The fund said sub­ject to ap­proval by the JSE, list­ing and trad­ing of the new shares was ex­pected to com­mence at 9am to­day.

It had ear­lier re­served the right to in­crease the size of the eq­uity raise. Java Cap­i­tal acted as sole book run­ner. It is not the first time the com­pany has raised cash in the form of a book build.

In April last year, it suc­cess­fully raised R400m through an ac­cel­er­ated book build. It was ini­tially seek­ing to raise R300m but in­creased the amount be­cause of strong de­mand.

Vuk­ile made a big in­vest­ment at the be­gin­ning of July in Spain when it an­nounced an ac­qui­si­tion of a port­fo­lio of nine high-qual­ity, newly-built re­tail parks across Spain via its new 98.3 per­cent Span­ish Reit sub­sidiary Castel­lana Prop­er­ties.

Boosts ex­po­sure

The R2.8bn off-mar­ket trans­ac­tion in­creases Vuk­ile’s di­ver­si­fi­ca­tion and it boosts its in­ter­na­tional ex­po­sure to about 21 per­cent of to­tal prop­erty as­sets. The ac­qui­si­tion also grows its Span­ish port­fo­lio to 11 prop­er­ties.

Chief ex­ec­u­tive Lau­rence Rapp com­mented af­ter the ac­qui­si­tion that the trans­ac­tion had given Vuk­ile im­me­di­ate scale in Spain. “Vuk­ile now of­fers the most fo­cused ex­po­sure to the Span­ish prop­erty in the South African Reit mar­ket. The ac­qui­si­tion rep­re­sents a 6.2 per­cent pre-geared prop­erty yield and reaf­firms Vuk­ile’s prospects to de­liver growth in div­i­dends be­tween 7 and 8 per­cent,” said Rapp.

In the re­sults to end March, Vuk­ile re­ported a fall in gross prop­erty rev­enue to R1.8bn from R2.3bn. Profit was R1.5bn, slightly down from R1.6bn the pre­vi­ous year. Head­line earn­ings per share were 151.13c a share, down from 168c. Vuk­ile’s shares fell 2.31 per­cent yes­ter­day to close at R19.

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