AGR Assura Plc

21 May 2024

Assura plc

Assura & USS announce £250m joint venture

Assura plc (Assura) and Universities Superannuation Scheme Limited (USS), today announce they have entered into a new £250m 20:80 joint venture to support investment in essential NHS infrastructure.

A strategic partnership has been formed between USS, the principal pension scheme for universities and higher education institutions in the UK with over £75bn of assets under management, and Assura, the specialist healthcare property investor and developer.

This long-term partnership will support investment into essential NHS community healthcare buildings, which help to address the current backlog of patients waiting for care. As the population ages and more people live with chronic conditions, modern, flexible healthcare buildings are central to the NHS's priority of delivering more care closer to patients.

The joint venture has an initial term of 20 years and will be seeded with an initial agreed portfolio of seven assets (£107 million), transferred from Assura's existing portfolio at a small discount to the March 2024 valuation. The joint venture is targeting acquisition-led growth to £250 million over the next three years, with potential to grow to £400 million thereafter. The joint venture will focus exclusively on assets let directly to NHS or GP tenants with rents linked to inflation or with fixed uplifts.

Assura will retain a 20% equity interest in the JV and act as property and asset manager, receiving asset management fees linked to the valuation of the portfolio.

The transaction will further strengthen Assura's balance sheet, bringing additional diversity to the available funding sources to support Assura's continued growth trajectory.

It is intended that the net cash proceeds received (£85 million) will be recycled into Assura's attractive pipeline of acquisition and development opportunities across medical centres and broader healthcare markets.

Lazard & Co., Limited acted as exclusive financial adviser to Assura.

Jonathan Murphy, CEO of Assura, said:

"We are delighted to announce this exciting transaction with a high-quality and long-term capital partner in USS.

"This important transaction highlights the attractive investment characteristics in the healthcare sector and specifically the long term resilient cash flows generated by our assets.

"As well as demonstrating our ability to re-deploy capital into our pipeline of opportunities in broader healthcare markets, we have sourced new capital that will fund investment in healthcare infrastructure that is so badly needed to enable better health outcomes."

Alex Turner, Head of Property at USS, said:

"We are looking forward to working with Assura on this exciting joint venture. As a long term investor, we believe that investing in important UK infrastructure and paying our members pensions are strongly aligned as these kinds of assets can provide inflation-linked income over many years. Healthcare is a very important sector and we're delighted to support investment in essential social infrastructure."

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This announcement contains inside information as defined in Article 7 of the EU Market Abuse Regulation No 596/2014 and has been announced in accordance with the Company's obligations under Article 17 of that Regulation.

Lazard & Co., Limited ("Lazard"), which is authorised and regulated in the United Kingdom by the FCA, is acting exclusively as financial adviser to Assura and no one else in connection with the transaction referred to in this announcement and will not be responsible to anyone other than Assura for providing the protections afforded to clients of Lazard nor for providing advice in relation to such transaction or any other matters referred to in this announcement. Neither Lazard nor any of its affiliates (nor any of their respective directors, officers, employees or agents), owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Lazard in connection with the transaction referred to in this announcement, this announcement, any statement contained herein or otherwise.

Notes to Editors

About Assura

Assura plc is the UK's leading specialist healthcare property investor and developer. Assura enables better health services through its portfolio of more than 600 healthcare buildings, from which over six million patients are served.

A UK REIT based in Altrincham, Assura is a constituent of the FTSE 250 and the EPRA* indices. As at 31 March 2024, Assura's portfolio was valued at £2.7 billion and has a strong track record of growing financial returns and dividends for shareholders.

At Assura, we BUILD for health, having developed over 100 new healthcare buildings in our history, and at the heart of our strategy sits The Bigger Picture; Healthy Environment (E), Healthy Communities (S), Healthy Business (G).

Further information is available at www.assuraplc.com

*EPRA is a registered trademark of the European Public Real Estate Association.

About USS

Universities Superannuation Scheme (USS) was established in 1974 as the principal pension scheme for universities and higher education institutions in the UK. We work with around 330 employers to help build a secure financial future for 528,000 members and their families. We are one of the largest pension schemes in the UK, with total assets of around £75.5bn (at 31 March 2023).

More information can be found at uss.co.uk