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Atlantic Leaf makes UK acquisition

Sep 12 2017 20:02

Cape Town – Atlantic Leaf Properties, the Mauritian-incorporated real estate company, listed on the JSE and the Stock Exchange of Mauritius, announced on Tuesday plans to grow its earnings and further increase its projected forward distribution for the 2018 financial year.

This will be done through a 45.03% acquisition of a portfolio of UK-based retail warehouse and industrial property portfolio, in a joint venture with LMP Retail Warehouse JV Holdings, controlled by a London-listed REIT.
 
This transaction is expected to generate a cash-on-cash return to Atlantic Leaf of 9.33%, increasing the current year’s forecast distribution of 9.0 pence per share to 9.1 pence per share.

Management has further given guidance of 5-7% growth in distribution for the 2018/2019 financial period which, based on the current share price of around R17.00, translates to a forward yield of 9.5%.

Atlantic Leaf is, therefore, embarking on an accelerated book build to raise £30m through a placing of new shares on the JSE, which is also expected to further broaden the company’s shareholder base.
 
The capital raise will be conducted at a minimum of £1.015 per share and is supported by a pre-commitment given by Vukile Property Fund. The majority of the proceeds would be deployed into the new acquisition. Vukile remains a supportive shareholder.

Atlantic Leaf’s investment will be approximately £24m for the net equity of the joint venture.

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