14 Jul 2020 15:30
14 July 2020
Raven Property Group Limited ("Raven", the "Company" or the "Group")
Publication of Circulars and a Prospectus in connection with the Re-Designation of 100% of Raven's Convertible Preference Shares into New Ordinary Shares and New Preference Shares, notice of general meeting and notices of class meetings
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Trading Update
Publication of Circulars and a Prospectus
Further to the announcement made on 23 April 2020, the Company confirms that it will today publish circulars including notices convening a general meeting of the Company's Ordinary Shareholders and class meetings of the Company's Convertible Preference Shareholders and Preference Shareholders, in connection with the approval of the Re-designation of all of its Convertible Preference Shares into New Ordinary Shares and New Preference Shares at a ratio of 0.6108 New Ordinary Shares and 0.5849 New Preference Shares for every one Convertible Preference Share. The Company will also today publish a prospectus (the "Prospectus") in connection with the listing of the New Ordinary Shares and New Preference Shares.
The effective date of the Re-designation will be 30 September 2020, at which point the entire Convertible Preference Share class will cease to exist. It is expected that the cancellation of trading of the Convertible Preference Shares will take effect at 8.00 am on 30 September 2020 and trading of the New Ordinary Shares and New Preference Shares will commence at 8.00am on 30 September 2020.
Convertible Preference Shareholders will be entitled to receive the Convertible Preference Dividend which has accrued on the Convertible Preference Shares up until 29 September 2020 from the previous payment date in accordance with the rights attaching to the Convertible Preference Shares.
The New Preference Shares which arise as a result of the Re-designation will rank equally in all respects with the Existing Preference Shares, with holders of the New Preference Shares beginning to accrue their entitlement to the Preference Dividend from 30 September 2020, being the date upon which the Re-designation will become effective.
The New Ordinary Shares which arise as a result of the Re-designation will rank equally in all respects with the Existing Ordinary Shares, including the right to receive all dividends and distributions made, paid or declared (and a right to participate in tender offer buy-backs of Ordinary Shares carried out by the Company) in each case after the time the Re-designation becomes effective (which is currently scheduled to be 00.00 on 30 September 2020). In the event that the Company resolves to proceed with the tender offer(s) referred to in the trading update below (or combines them), the New Ordinary Shares will not be in existence at the time such tender offer(s) take place and as such will not be capable of being tendered pursuant to it or them.
A copy of each of the circulars and the Prospectus has been submitted to the National Storage Mechanism and will shortly be available for inspection at www.morningstar.co.uk/uk/NSM. The circulars, Prospectus and TISE listing document will also shortly be available on the Company's website at www.theravenpropertygroup.com.
Defined terms in this announcement will have the same meaning as defined in the circulars and the Prospectus.
Trading Update
Although the long term impact of the coronavirus pandemic on the Russian market is as yet unknown, the Group's warehouse properties have continued to operate throughout the crisis. This is, in most part, due to logistics networks being an essential part of the supply chain, allowing supermarkets, their suppliers and e-commerce arms to operate during lockdown. The Russian government has introduced compulsory rental deferral schemes, mostly targeted at the non-essential retail and hospitality industries, which have not had a significant impact on the portfolio but we continue to work with all tenants who may have difficulties in meeting rental payments. Our principal markets of Moscow and Saint Petersburg have now eased lockdown restrictions but Russia continues to record some of the highest rates of infection globally and the risk of renewed restrictive measures must remain a possibility.
The Group has been fortunate enough to continue to record good recovery rates in rent collection due to the quality of our tenant profile and the large proportion that have continued to operate during lockdown restrictions. The warehouse portfolio is 93% let today and rent collections have averaged over 96% each month since March. 3% of rentals due have been deferred for tenants who have been hardest hit by the crisis and 1% is overdue. Occupancy across the Moscow market, the most important for the Company, has remained high and agents are not forecasting any significant change in the vacancy rate at the year end, which is predicted to be less than 5%. Rental levels for dry warehouse space remain in the region of RUB4,000-RUB4,100 per sqm and demand appears to remain strong, with a number of large occupiers looking for space to enhance and expand their supply chains. New speculative development is expected to be below forecasts as a result of the coronavirus, further reducing the options for tenants wanting to expand today. However, the Group's leasing expectations have been tempered for the remainder of the year and for the 2021 financial year on the assumption that some sectors will postpone investment and expansion decisions. The potentially positive impact of this crisis on the market is acceleration in the move to e-commerce supply chains with a marked increase in demand evident in that area.
The Group's property portfolio has been independently valued by JLL as at 31 May 2020 and shows no material movement on the underlying Rouble values compared to 31 December 2019. The investment market has been understandably quiet in the first half of the year but the reduction in the key rate of 150bps in the year to date by the Central Bank of Russia, including a 100bps cut in June, should provide impetus for values to increase assuming investor demand returns.
The conditional agreement entered into by the Company on 12 December 2019 (as amended by deeds of amendment dated 11 March 2020 and 23 April 2020, respectively) for the off-market purchase of 42,118,860 of the Company's Convertible Preference Shares from IAM (acting as agent for its underlying funds, IHIF and IIF) will lapse with effect from 31 July 2020. The Company will re-assess the purchase agreements between the Company and IAM in respect of the purchase by the Company of 139,678,106 Ordinary Shares and 41,803,518 Preference Shares as market conditions settle and will make an announcement in this regard when appropriate.
As explained in the Company's 2019 results announcement and its circular to Ordinary Shareholders in respect of its 2020 annual general meeting, the Board intends to make a final distribution in respect of the year ended 31 December 2019 of 2.25p per Ordinary Share by way of a tender offer buyback of Ordinary Shares. The Company also explained that it was reviewing that position as a result of the uncertainly created by the coronavirus pandemic and hoped to be in a position to update the market on the issue at the time it publishes its half year results in August 2020. This remains the case. At such time the Company hopes also to notify the market as to whether it intends to make an interim distribution in respect of the 6 month period ended 30 June 2020 (again by way of a tender offer buy-back of Ordinary Shares) and/or whether it will combine such interim distribution with the final distribution in respect of the year ended 31 December 2019.
Expected Timetable of Principal Events
The expected timetable of principal events is as follows
Posting of the General Meeting Circular to Shareholders, posting of the Convertible Preference Shareholder Circular to Convertible Preference Shareholders and posting of the Preference Shareholder Circular to Preference Shareholders | 14 July 2020 |
Latest time and date for receipt of Forms of Proxy and/or CREST proxy instructions in relation to the General Meeting, Convertible Preference Shareholder Meeting and Preference Shareholder Meeting | 10.00am., 10.15am., and 10.30 am. respectively on 29 July 2020 |
Record Date | 6.00pm. on 29 July 2020 |
General Meeting | 10.00 am. on 31 July 2020 |
Convertible Preference Shareholder Meeting | 10.15 am. on 31 July 2020 |
Preference Shareholder Meeting | 10.30 am. on 31 July 2020 |
Announcement of the results of the General Meeting | 31 July 2020 |
Announcement of the results of the Convertible Preference Shareholder Meeting | 31 July 2020 |
Announcement of the results of the Preference Shareholder Meeting | 31 July 2020 |
Completion of the Re-designation | 00.00 on 30 September 2020 |
Expected admission and commencement of dealings in each of the New Ordinary Shares and the New Preference Shares on the London Stock Exchange's Main Market(1) | 8.00 a.m. on 30 September 2020 |
CREST accounts credited with the New Ordinary Shares and New Preference Shares | 30 September 2020 |
Despatch of definitive share certificates in respect of the New Ordinary Shares and New Preference Shares | 14 October 2020 |
If any of the above times and/or dates change, the revised times and/or dates will be notified to Ordinary Shareholders by an announcement through the Regulatory Information Service of the London Stock Exchange. All references in this document are to London time unless otherwise stated.
SA Shareholders should refer to the timetable in the Letter to SA Shareholders for the relevant South African Standard Time ("SAST") timings.
(1) Dealings in New Ordinary Shares are expected to commence at 8.00am on 30 September on (i) The International Stock Exchange (ii) the main board of the Johannesburg Stock Exchange; and (iii) on the Moscow Stock Exchange. Dealings in the New Preference Shares are expected to commence on The International Stock Exchange at 8.00a.m.on 30 September 2020. | |
The information contained within this announcement relating to the Company's trading update is considered by Raven Property Group Limited to constitute inside information as stipulated under the Market Abuse Regulation (EU) No.596/2014. Upon the publication of this announcement via a Regulatory Information Service, this inside information will be considered to be in the public domain.
The person responsible for arranging for the release of this announcement on behalf of the Company is Benn Garnham, Company Secretary.
Enquiries
Raven Property Group Limited Anton Bilton Glyn Hirsch
| Tel: + 44 (0) 1481 712955 |
Novella Communications (public relations adviser) Tim Robertson Fergus Young
| Tel: +44 (0) 203 151 7008 |
N+1 Singer (Sponsor and UK Broker to the Re-Designation) Corporate Finance - James Maxwell / James Moat Sales - Alan Geeves / James Waterlow
| Tel: +44 (0) 20 7496 3000 |
Numis Securities Limited (UK joint broker) Alex Ham / Jamie Loughborough / Alasdair Abram Nathan Brown / George Shiel
| Tel: + 44 (0) 207 260 1000 |
Renaissance Capital (South African broker) Yvette Labuschagne
| Tel: +27 (11) 750 1448 |
Renaissance Capital (Russian broker) David Pipia
| Tel: + 7 495 258 7770 |
Ravenscroft (TISE sponsor) Emma Ozanne
| Tel: + 44 (0) 1481 729100 |
About Raven Property Group
Raven Property Group Limited was founded in 2005 to invest in class A warehouse complexes in Russia and lease to Russian and International tenants. Its Ordinary Shares and preference shares are listed on the Main Market of the London Stock Exchange and admitted to the Official List of the UK Listing Authority and the Official List of The International Stock Exchange ("TISE"). Its Ordinary Shares also have a secondary listing on the main board of the Johannesburg Stock Exchange and the Moscow Stock Exchange. Its convertible preference shares are admitted to the Official List of TISE and to trading on the SETSqx market of the London Stock Exchange. The Group operates out of offices in Guernsey, Moscow and Cyprus and has an investment portfolio of circa 1.9 million square metres of Grade "A" warehouses in Moscow, St Petersburg, Rostov-on-Don, Novosibirsk and Nizhny Novgorod and 49,000 square metres