(Alliance News) - Helical PLC announced on Wednesday it intends to covert to an REIT with effect from April 1.
The London-based real estate investment company said, as part of the process, it will notify Her Majesty's Revenue & Customs of the intention to convert and will seek Helical shareholder approval to replace its current articles of association.
REIT stands for real estate investment trust, it is a company that owns, operates, or finances income-generating real estate.
Following conversion, Helical will be exempt from UK corporation tax on the profits of its property activities that fall within the REIT regime in the year ending March 31, 2023 and beyond.
Future dividends will continue to be paid out in line with Helical's current dividend policy. Dividends will comprise of any property income distribution required to comply with the REIT legislation payable out of Helical's net rental income and, if considered appropriate, a further dividend out of other sources of its income and profits.
Chief Executive Gerald Kaye said: "Today, Helical has a portfolio with a superior sustainability rating, with 99% rated [energy performance certificate] A or B and 85% [building research establishment's environmental assessment method] Outstanding or Excellent, by value. This portfolio, together with its long-term investment model, facilitate the conversion of the company's operations to a REIT and with the rate of UK corporation tax increasing from 19% to 25% from April 2023, the board believes that the time is now right for Helical to convert to a REIT."
Shares in Helical were up 4.7% at 452.43 pence on Wednesday morning in London.
By Heather Rydings; email@example.com
Copyright 2022 Alliance News Limited. All Rights Reserved.