(Alliance News) - Segro PLC on Tuesday announced a GBP800 million fundraise as the property investor looks to capitalise on "potential acquisition opportunities".
Segro will raise the funds through a placing and retail offer. The GBP800 million fundraise will represent around 7.5% of its share capital. The price per share will be determined at the end of a bookbuild process.
Segro shares fell 0.2% to 861.80 pence each in London on Tuesday. It has a market capitalisation of GBP10.58 billion.
"New equity will allow the group to pursue additional growth opportunities, including new and existing development projects and to take advantage of potential acquisition opportunities which may arise, whilst maintaining a strong balance sheet," it said.
Segro said it has a "sizeable development pipeline" which it believes can add GBP440 million of additional rent, requiring development capital expenditure of over GBP3.8 billion.
Segro added: "Market expectations for lower interest rates, if sustained, should provide a positive backdrop for a recovery of investment market sentiment as the year progresses. Segro is well-placed for further attractive growth as asset values start to bottom-out, rents continue to grow, and developments offer attractive profitability."
The company said it plans to increase its passing rents by more than 50% over the next three years.
"As investment markets stabilise, Segro expects to see the emergence of potentially attractive asset acquisition opportunities. Segro believes that it has a significant competitive advantage here given its established local platforms and stakeholder relationships, strong balance sheet, significant liquidity, and its unsecured funding model," it added.
Segro said the funds will be "supplemented" by its policy of disposing of assets worth between 1-2% of gross asset value per year.
By Eric Cunha, Alliance News news editor
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Segro (SGRO)