(Alliance News) - Growthpoint Properties Ltd on Wednesday said it has secured further support for its acquisition of a 51% stake in Capital & Regional PLC.
In mid-October, the Johannesburg-listed real estate investment trust had agreed to invest around GBP150.4 million for a 51% interest in London-headquartered firm Capital & Regional.
The first part of the investment will see Growthpoint acquire 219.8 million existing shares in Capital & Regional for 33 pence per share, at a total of GBP72.5 million.
Capital & Regional shares were trading 0.2% higher in London on Wednesday at 26.21p each, while in Johannesburg the shares were up 3.8% at ZAR5.19 each.
The second part is for Growthpoint to subscribe for 311.5 million new Capital & Regional shares, at a price of 25p each to raise GBP77.9 million before costs for the company.
Capital & Regional said that at least GBP50 million of the proceeds raised through the subscription will go towards reducing leverage and funding capital expenditure, giving the company more room to move forward with its project pipeline.
Following the two transactions, Growthpoint will own 51% of Capital & Regional's enlarged share capital.
On Wednesday, Growthpoint said it has received a letter of intent from investment manager Allan Gray Proprietary Ltd confirming its intention to accept the offer and to recommend it to its clients, which hold voting rights in Capital & Regional.
As at Monday, Allan Gray's clients were the beneficial owners of 46.1 million Capital & Regional shares, representing a 6.3% holding.
Growthpoint said it has received irrevocable undertakings and letters of intent to accept its offer in respect of a total of 151.0 million Capital & Regional shares, representing, in aggregate, 21% of the issued share capital of Capital & Regional as at Monday.
Growthpoint shares were trading 0.8% lower on Wednesday in Johannesburg at ZAR22.56 each.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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Capital & Regional (CAL)