GRN.L Regulatory News (GRN)

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF COLUMBIA), AUSTRALIA, CANADA, JAPAN, SWITZERLAND OR SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THIS ANNOUNCEMENT 

This announcement is not an offer of securities for sale in the United States or any other jurisdiction. This announcement is an advertisement and not a prospectus (or prospectus equivalent document). Investors should not subscribe for or purchase any shares referred to in this announcement except solely on the basis of information in the prospectus (the "Prospectus") to be published by Green REIT plc ("Green", or the "Company", or the "Group") on or around 7 April 2014 in connection with the admission of ordinary shares in the capital of the Company (the "Shares") to the Official Lists of the Irish Stock Exchange and the UK Listing Authority and to trading on the regulated market for listed securities of the Irish Stock Exchange and on the main market for listed securities of the London Stock Exchange plc ("Admission"). A copy of the Prospectus will, following publication, be available on the Company's website (www.greenpropertyreit.com) and will be made available for viewing at the National Storage Mechanism at http://www.hemscott.com/nsm. This announcement is not an offer to sell, or a solicitation of an offer to acquire, securities in the United States or in any other jurisdiction. Neither this announcement nor any part of it shall form the basis of or be relied on in connection with or act as an inducement to enter into any contract or commitment whatsoever.

4 April 2014

Green REIT plc

Firm Placing and Placingand Open Offer

Green REIT plc today announces an intention to make a Firm Placing and Placing and Open Offer to raise gross proceeds of approximately €400 million by the issue of 356,969,696 New Ordinary Shares at 112 cent (or €1.12) per New Ordinary Share (the "Issue Price").

Highlights

· Firm Placing and Placing and Open Offer to raise gross proceeds of approximately €400 million (approximately €385 million net of expenses). 

· 89,242,424 New Ordinary Shares will be issued through the Firm Placing at the Issue Price to raise gross proceeds of approximately €100 million and 267,727,272 New Ordinary Shares will be issued through the Placing and Open Offer at the Issue Price to raise gross proceeds of approximately €300 million.

· The Issue Price reflects a 5.5% discount to the Closing Price on 3 April 2014.

· The net proceeds of the Firm Placing and Placing and Open Offer will be principally used to fund further property investments in line with the Company's existing investment policy.

· The Management Team, led by Stephen Vernon and Pat Gunne, focuses on creating both sustainable income and strong capital returns for the Group with a target total shareholder return of 10% to 15% per annum (pre-taxation) both when the Original Net Proceeds are fully invested and when the Net Proceeds are fully invested.

The Prospectus containing details of the Capital Raise and the Circular containing details of the Resolutions are expected to be published on Monday 7 April and will be available on the Company's website, www.greenpropertyreit.com. An Extraordinary General Meeting to approve the Resolutions is expected to be held at 10.00am on 1 May 2014 at the Conrad Dublin Hotel, Dublin 2, Ireland.

Commenting on today's announcement, Gary Kennedy, Chairman of Green REIT plc, said:

"Green REIT raised gross proceeds of €310 million in July 2013 and established itself as the first real estate investment trust in Ireland. The success of our listing and capital raise was based on a combination of our proven and experienced management team and our attractive timing. We established ourselves as an investor in the Irish commercial property market when market activity was increasing and values started recovering." 

"We have now successfully deployed €335 million of equity and debt over a nine month period - consistent with our stated strategy. Our objective now is to raise additional capital to grow the size of our portfolio, enhance our income stream and drive shareholder returns."

Stephen Vernon, Chairman, Green Property REIT Ventures Limited, The Investment Manager, said:

"We have made rapid progress since we established Green REIT. The progress made reflects our ability to identify and acquire attractive assets - both on and off market - due to the strength of our team, our disciplined approach to asset acquisitions and our extensive network of industry relationships. We now intend to raise additional capital and believe we are well positioned to capitalise on the opportunities presented by current and expected market conditions. Our objective is to continue to build a portfolio of high quality assets which will deliver an attractive return for our shareholders."

"The capital raise at €1.12 represents a 12.0% premium to the issue price per share as at IPO on 18 July implying an annualised return of 16.8%."

Background to and Reasons for the Capital Raise

At the time of the Initial Admission, the Management Team believed that the prospects for negotiating attractive investment opportunities would be significant for investors with readily available resources for acquisitions and the ability to source deals both from distressed and more conventional sellers. The Directors believed that the market was at a stage in the cycle where there was a positive gap between investment yields and borrowing costs enabling attractive risk adjusted returns to be generated in an environment of relatively modest gearing. The Management Team believed that investment opportunities with value levels which reflected the extent of the economic contraction in Ireland could be accessed as liquidity finally re-emerged in the investment market. They also believed that a strongly capitalised investor would be well placed to invest in assets which require a high level of active management, within a sector that has been deprived of both intensive asset management and capital over the past five years. In order to take advantage of these opportunities, the Company was launched in July 2013 when it raised €310 million (before expenses) in an over-subscribed issuance of Existing Ordinary Shares. 

Since July 2013, the Company has acquired a portfolio of Irish investment properties. In October 2013 the Company acquired its first investment property, the INM Building, and in November 2013, the Company acquired a portfolio of ten investment properties (eight of which are located in Dublin) from Danske Bank Ireland for €127.6 million (net of acquisition costs), with an initial yield on the investment properties in excess of 8.5%. This marked the first substantial acquisition undertaken by the Company post the Initial Admission and the acquisition was funded from existing cash resources. The portfolio is a mix of prime and good secondary assets, totalling over 708,000 sq. ft. in lettable space and was 84% let as at the time of purchase. The composition of the portfolio is weighted towards the retail (41%) and office (37%) sectors. At the time of purchase the properties generated passing rents of €11.1 million per annum from a strong base of 36 commercial tenants, including Bank of Ireland, Homebase, Lidl, TK Maxx, Woodies, Park Rite and Kuehne & Nagel and 36 residential tenants. The WAULT across the portfolio was in excess of nine years. The portfolio also included a development site of approximately 112 acres adjacent to Dublin airport.

In November 2013, the Company also acquired another investment property, an office development on No. 2 Burlington Road and, in December 2013, a further investment property, Numbers 84-93 Lower Mount Street for €6.35 million, which is a single office block with an area of c. 49,000 sq. ft. On 5 March 2014, the Company acquired its second portfolio of commercial real estate assets from Danske Bank Ireland at a total cost of €22.8 million (€22.1 million net of acquisition costs). The Danske 2 Portfolio consists of two investment properties with approximately 79,000 sq. ft. in two locations in Dublin, Molesworth Street and Ormond Quay. The investment property located at 30-33 Molesworth Street, Dublin 2, in the city centre consists of four buildings which are currently occupied by seven tenants. The investment property at Molesworth Street is currently leased at what the Management Team believe are relatively low rents, providing the opportunity for rental growth with some of the existing leases due to expire between 2014 and 2016. The other investment property in the Danske 2 Portfolio, Ormond Building, is located on Dublin's Ormond Quay, Dublin 1, adjacent to the Irish Four Courts. It is a modern office building currently occupied by 12 tenants, with an area of approximately 31,000 sq. ft.

On 28 March 2014, The Central Park Limited Partnership, a 50:50 joint venture between the Company and the LVS Central Park Shareholder, through an entity owned by it, acquired the Central Park Portfolio which constitutes one investment property consisting of five modern office buildings with 690,843 sq. ft of space and approximately 7.4 acres of development lands. The Central Park Residential Portfolio was acquired by KW Real Estate plc, an entity related to Kennedy-Wilson Holdings, Incorporated.

As at the Last Practicable Date, the Company had deployed or committed approximately 86.9% of the Original Net Proceeds and through its 50% interest in The Central Park Limited Partnership had drawn down approximately €74.6 million of debt financing.

The Management Team believe that many of the opportunities that were in place at the time of the Initial Admission in the Irish market still exist and after due consideration the Board has concluded that now is an appropriate time to seek to raise additional capital for the Company in order to take advantage of these opportunities. The Company's principal use of the Net Proceeds of the Issue will be to fund future real estate investments consistent with the investment policy of the Company.

Summary of the principal terms of the proposed Firm Placing and Placing and Open Offer

Structure

The Company intends to raise €400 million (gross) or approximately €385 million (net of estimated expenses) through the issue of 356,969,696 New Ordinary Shares by way of a Firm Placing and Placing and Open Offer at €1.12 per New Ordinary Share.

Firm Placing

The Company is proposing to issue 89,242,424 Firm Placed Shares pursuant to the Firm Placing at €1.12 per Firm Placed Share. The Firm Placed Shares are not subject to clawback and do not form part of the Open Offer. The Firm Placing is expected to raise approximately €100 million (gross). The Firm Placing is subject to the same conditions and termination rights which apply to the Placing and Open Offer.

Placing and Open Offer

The Company intends to raise approximately €300 million (gross) through the Placing and Open Offer of 267,727,272 New Ordinary Shares at the Issue Price.

Qualifying Shareholders, on and subject to the terms and conditions of the Open Offer, are being given the opportunity to apply for the Open Offer Shares at the Issue Price, pro rata to their holdings of Existing Ordinary Shares on the Record Date on the following basis:

19 New Ordinary Shares for every 22 Existing Ordinary Shares

It is intended that J.P. Morgan Cazenove and Davy will agree, pursuant to a Placing and Open Offer Agreement to be entered into, to conditionally place all the Open Offer Shares at the Issue Price with institutional investors. The commitments of these Conditional Placees will be subject to clawback in respect of valid applications for Open Offer Shares by Qualifying Shareholders pursuant to the Open Offer. Subject to waiver or satisfaction of the conditions and the Placing and Open Offer not being terminated, any Open Offer Shares which are not applied for in respect of the Open Offer would be issued to the Conditional Placees and/or other subscribers procured by J.P. Morgan Cazenove and Davy, with the net proceeds retained for the benefit of the Company.

Conditions

The Firm Placing and the Placing and Open Offer would be conditional, inter alia, upon:

(i) the passing of all of the Resolutions;

(ii) Admission becoming effective by not later than 8.00 a.m. on 2 May 2014 (or such later time and/or date as the Company and Joint Bookrunners may agree, not being later than 8.00 a.m. on 30 May 2014); and

(iii) the Placing and Open Offer Agreement having become unconditional in all respects and not having been terminated in accordance with its terms. 

Accordingly, if any such conditions are not satisfied the Firm Placing and the Placing and Open Offer will not proceed, any Open Offer Entitlements admitted to CREST will thereafter be disabled and application monies received under the Open Offer will be refunded to the applicants, by cheque (at the applicant's risk) in the case of Qualifying Non-CREST Shareholders and by way of a CREST payment in the case of Qualifying CREST Shareholders, without interest, as soon as practicable thereafter.

Application for Admission

Application will be made to the Irish Stock Exchange and to the UK Listing Authority for the New Ordinary Shares to be issued under the Firm Placing and Placing and Open Offer to be admitted to listing on the Official Lists and application will be made to the Irish Stock Exchange and the London Stock Exchange for admission of the New Ordinary Shares to trading on their respective main markets for listed securities. Subject to the conditions below being satisfied, it is expected that Admission will become effective on 2 May 2014 and that dealings for normal settlement in the New Ordinary Shares will commence at 8.00 a.m. on the same day.

The New Ordinary Shares issued under the Firm Placing and Placing and Open Offer, when issued and fully paid, will be identical to and rank pari passu with the Existing Ordinary Shares, including the right to receive all dividends or other distributions made, paid or declared after Admission.

Important notice

Shareholders should note that the Open Offer is not a rights issue. Qualifying CREST Shareholders should note that, although the Open Offer Entitlements will be admitted to CREST and be enabled for settlement, applications in respect of entitlements under the Open Offer may only be made by the Qualifying Shareholder originally entitled or by a person entitled by virtue of a bona fide market claim raised by Euroclear's Claims Processing Unit. Qualifying non-CREST Shareholders should note that the Application Form is not a negotiable document and cannot be traded. Qualifying Shareholders should be aware that in the Open Offer, unlike in a rights issue, any Open Offer Shares not applied for will not be sold in the market or placed for the benefit of Qualifying Shareholders who do not apply under the Open Offer, but will be subscribed for under the Placing for the benefit of the Company.

A Qualifying Shareholder that takes up its Open Offer Entitlement in full will be diluted by 13.4% as a result of the Firm Placing and Placing and Open Offer. A Qualifying Shareholder that does not take up any Open Offer Shares under the Open Offer (or a Shareholder in the United States or an Excluded Territory who is not eligible to participate in the Open Offer) will experience a more substantial dilution of 53.5% as a result of the Firm Placing and Placing and Open Offer.

Prospectus

The Prospectus is expected to be published on 7 April 2014 containing full details of how Shareholders can participate in the Open Offer. The Company is also expected to publish the Circular in accordance with the requirements of the Listing Rules, containing a notice of an extraordinary general meeting expected to be held at 10.00 a.m. on 1 May 2014. Completion of the Capital Raise is conditional, inter alia, upon the approval of the Resolutions set out in the Circular.

The Prospectus will contain valuations which value the Company's property portfolio at €329,020,000 as at 31 December 2013 (excluding the Central Park Portfolio which was valued as at 20 February 2014).

Copies of the Prospectus and the Circular will be available from the registered office of Green REIT plc at Styne House, Hatch Street Upper, Dublin 2 during normal business hours on any weekday (except Saturdays, Sundays and public holidays) from the date of its publication until Admission. The Prospectus and Circular will both be available on the Company's website, www.greenpropertyreit.com.

For further information, please contact:

Davy (Joint Bookrunner, Joint UK Sponsor and Irish Sponsor) +353 (0)1 679 6363

Ronan Godfrey

Brian Ross

Brian Garrahy

J.P. Morgan Cazenove (Joint Bookrunner and Joint UK Sponsor) +44 (0)20 7742 4000

Robert Fowlds

Paul Hewlett

Barry Meyers

FTI Consulting (PR to the Company)

Dublin London

+353 (0)1 663 3686 +44 (0)20 3727 1000

Mark Kenny Stephanie Highett

Jonathan Neilan Richard Sunderland

Melanie Farrell Giles Barrie

Nina Legge

Statistics relating to the Capital Raise

Expected timetable of principal events 20141,2

IMPORTANT NOTICES 

The information in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. The material set forth herein is for information purposes only and should not be construed as an offer of securities for sale in the United States or any other jurisdiction. 

This announcement is an advertisement and not a prospectus and investors should not purchase any Shares referred to in this announcement except solely on the basis of information in the prospectus to be published by Green REIT plc in due course in connection with the admission of the Shares to primary listing on the Official List of the Irish Stock Exchange, and a premium listing on the Official List of the UK Listing Authority and admission to trading on the regulated market for listed securities of the Irish Stock Exchange and on the main market for listed securities of the London Stock Exchange. 

The distribution or publication of this announcement, any related documents, and the offer, sale and/or issue of the Shares in certain jurisdictions may be restricted by law. No action has been taken to permit possession or distribution or publication of this announcement, other than in Ireland and the United Kingdom. Persons into whose possession this announcement (or any other offer or publicity material relating to the Shares) comes are required to inform themselves about and to observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdiction. 

This announcement does not constitute or form part of an offer to sell, or the solicitation of an offer to buy or subscribe for, Shares to any person in any jurisdiction to whom or in which such offer or solicitation is unlawful and, in particular, is not for release, publication or distribution in or into the United States, Australia, Canada, Japan, Switzerland or South Africa. 

This announcement has been issued by the Company and is directed only at (i) persons who are outside the United Kingdom, or (ii) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended from time to time (the "Order"), or (iii) persons who fall within Article 49(2)(a) to (d) of the Order (high net worth companies, unincorporated associations etc), or (iv) persons to whom this announcement may otherwise be lawfully communicated (all such persons together being referred to as "Relevant Persons"). Any investment activity to which this announcement relates will only be available to and will only be engaged with, Relevant Persons. Any person who is not a Relevant Person should not act or rely on this document or any of its contents. 

This announcement has been issued by the Company and is directed only at persons in the European Economic Area ("EEA"): (a) who are professional investors within the meaning of Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers ("AIFMD") and, where permitted by the local law of the relevant EEA member state, investors other than professional investors. A "professional investor" is defined in AIFMD as an investor which is considered to be a professional client or may, on request, be treated as a professional client within the meaning of Annex II to Directive 2004/109/EC; and (b) only to the extent that the Shares in the Company: (i) are permitted to be marketed into the relevant EEA member state pursuant to Articles 31, 32 and 43 of AIFMD (as implemented into local law); or (ii) can otherwise be lawfully offered or sold (including on the basis of an unsolicited request from a professional investor).

The New Ordinary Shares and the Open Offer Entitlements have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act") or under any securities laws of any state or other jurisdiction of the United States or under the applicable securities laws of Australia, Canada, Japan, Switzerland or South Africa. The New Ordinary Shares and the Open Offer Entitlements may not be offered or sold in the United States or to, or for the account or benefit of, US persons (as defined in Regulation S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable state securities laws. There will be no public offer of securities in the United States. 

Any subscription for New Ordinary Shares in the proposed Issue should be made solely on the basis of the information contained in the Prospectus to be issued by the Company in connection with Admission. No reliance may or should be placed by any person for any purposes whatsoever on the information contained in this announcement or on its completeness, accuracy or fairness. The information contained in this announcement is given at the date of its publication (unless otherwise marked) and is subject to updating, revision and amendment when the Prospectus is published. In particular, the proposals referred to herein are tentative and are subject to verification, material updating, revision and amendment. 

Certain statements contained in this announcement constitute "forward-looking statements" regarding the belief or current expectation of the Company, the Directors, the Investment Manager and the Management Team about the Company's financial condition, results of operations and business. Generally, but not always, words such as "may", "could", "should", "will", "expect", "intend", "estimate", "anticipate", "assume", "believe", "plan", "seek", "continue", "target", "goal", "would" or their negative variations or similar expressions identify forward-looking statements. Such forward-looking statements are not guarantees of future performance. Rather, they are based on current views and assumptions and involve known and unknown risks, uncertainties and other factors, many of which are outside the control of the Company and the Investment Manager and are difficult to predict, which may cause the actual results, performance, achievements or developments of the Company or the industries in which it operates to differ materially from any future results, performance, achievement or developments expressed or implied from these forward-looking statements. Forward-looking statements speak only as of the date they are made and cannot be relied upon as a guide to future performance. A number of material factors could cause actual results to differ materially from those contemplated by the forward-looking statements. None of the Company, the Investment Manager,J.P. Morgan Cazenove nor Davy undertakesany obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances, unanticipated events, new information or otherwise occurring after the date of this announcement except as required by law or by any appropriate regulatory authority. 

The New Ordinary Shares are only suitable for investors who understand the potential risk of capital loss and that there may be limited liquidity in the underlying investments of the Company and in the Shares, for whom an investment in the Shares is part of a diversified investment programme and who fully understand and are willing to assume the risks involved in such an investment programme. There is no guarantee that the Issue will proceed and that Admission will occur and you should not base your financial decisions on the Company's intention in relation to the Admission and Issue at this stage. Acquiring Shares to which this announcement relates may expose an investor to a significant risk of losing all of the amount invested. When considering what further action you should take you are recommended to immediately consult, if you are resident in Ireland, an organisation or firm authorised or exempted pursuant to the European Communities (Markets in Financial Instruments) Regulations 2007 (Nos. 1 to 3) or the Investment Intermediaries Act 1995 (as amended) and, if you are resident in the United Kingdom, a person authorised under the Financial Services and Markets Act 2000, as amended by the United Kingdom, or another appropriately authorised professional adviser if you are in a territory outside Ireland or the United Kingdom. This announcement does not constitute a recommendation concerning the Issue. The price and value of the Shares may decrease as well as increase. Information in this announcement, past performance and any documents relating to the Issue or Admission cannot be relied upon as a guide to future performance. 

J.P. Morgan Cazenove, which is in the United Kingdom authorised by the Prudential Regulation Authority (the "PRA") and regulated by the Financial Conduct Authority (the "FCA") and the PRA, is acting exclusively for the Company and no one else in connection with Admission and the Issue and will not be responsible to anyone other than the Company for providing the protections afforded to its clients or for providing any advice in relation to the Admission, the Issue or any matter referred to herein.

Davy, which is authorised and regulated in Ireland by the Central Bank of Ireland, is acting exclusively for the Company and no one else in connection with Admission and the Issue and will not be responsible to anyone other than the Company for providing the protections afforded to its clients or for providing any advice in relation to Admission, the Issue or any matter referred to herein.

In connection with the Issue and Admission, each of the Joint Bookrunners or any of their respective affiliates, acting as investors for their own accounts, in accordance with applicable legal and regulatory provisions, and subject to the provisions of the Placing and Open Offer Agreement, may retain, purchase, sell, offer to sell or otherwise deal for their own account(s) in relation to the Shares and/or related instruments in connection with the Capital Raise otherwise. Accordingly, references in the Prospectus, once published, to the Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, the Joint Bookrunners or any of their respective affiliates acting as investors for their own accounts. Except as required by applicable law or regulation, the Joint Bookrunners do not propose to make any public disclosure in relation to such transactions. In addition the Joint Bookrunnersor their affiliates may enter into financing arrangements (including swaps or contracts for difference) with investors in connection with which the Joint Bookrunners (or their affiliates) may from time to time acquire, hold or dispose of Shares

None of the Company, the Investment Manager, J.P. Morgan Cazenove, Davy or any of their respective affiliates, their respective directors, officers or employees, or any other person accepts any responsibility or liability whatsoever for the contents of, or makes any representation or warranty, express or implied, as to the accuracy, completeness, correctness or fairness of the information or opinions contained in, this announcement or any document referred to in this announcement (or whether any information has been omitted from this announcement) or any other information relating to the Company or the Investment Manager or their respective affiliates, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of the announcement or its contents or otherwise arising in connection therewith. Accordingly, the Company, the Investment Manager, J.P. Morgan Cazenove, Davy and any of their respective affiliates, their respective directors, officers or employees, and any other person acting on their behalf expressly disclaims any and all liability whatsoever for any loss howsoever arising from, or in reliance upon, the whole or any part of the contents of this announcement, whether in tort, contract or otherwise which they might otherwise have in respect of this announcement or its contents or otherwise arising in connection therewith. 

APPENDIX

In this announcement, the following expressions have the following meanings unless the context requires otherwise: