Great Portland in 175m fund raising
THE West-end focused property group Great Portland Estates yesterday launched a £175m rights issue in order to take advantage of depressed values in the central London property market.
The rights shares, which will be underwritten by Credit Suisse and JP Morgan Cazenove, are being issued at 133p each, at a 53.4 per cent discount to Monday evening’s closing price.
The advisers maintained that a discount just above 50 per cent was needed in order to get the cash call fully underwritten.
Group chief executive Toby Courtauld said the issue proceeds would give the company resources of around £640m with which to make attractive invesments.
“We will look to invest in fundamentally cheap property assets in our core central London markets whilst maintaining our rigorous and disciplined investment approach,” Courtauld said.
The capital raising was announced as Great Portland announced a £436m pre-tax loss for the year to 31 March, a deficit that reflected reduced property valuations and losses on disposals. Adjusted net assets per share fell by 44 per cent over the year.
CREDIT SUISSE
JAMES-LEIGH PEMBERTON
JAMES Leigh-Pemberton of Credit Suisse, one of the Treasury’s advisers on the bank bailouts, worked with a team of four on the deal. He was present at Friday’s dress rehearsal.
Credit Suisse is jointly under-writing the issue with JP Morgan Cazenove, the firm that has been almost ever present in the recent run of rights issues. JP Morgan’s team is led by Jonathan Wilcox, while colleague Bronson Albery is the man with the strongest relationship with the company.
Also providing advice is investment banker Patrick Long of Lazard, who advises Great Portland long-term.