Investment Update
April 15 2010 - 1:15AM
UK Regulatory
TIDMTCF TIDMRUGB TIDMIRET
RNS Number : 2271K
Terra Catalyst Fund
15 April 2010
15 April 2010
TERRA CATALYST FUND
Investment Update
Terra Catalyst Fund undertakes to support the ING UK Real Estate Income Trust
takeover bid for Rugby Estates Investment Trust plc
Terra Catalyst Fund ("TCF") and other funds managed by Laxey Partners (the
"Laxey Funds") acquired, over time, 21,025,254 ordinary shares in Rugby Estates
Investment Trust plc ("Rugby REIT") representing approximately 36 per cent of
the issued share capital of Rugby REIT.
Following extensive dialogue with the Board of Rugby REIT, TCF and the Laxey
Funds have sought to maximise shareholder value by helping to facilitate a
transaction which would benefit all shareholders in Rugby REIT. This has
resulted in the announcement today of a recommended offer by ING UK Real Estate
Income Trust plc ("ING UK REIT") for the entire issued share capital of Rugby
REIT (the "Offer").
Under the terms of the Offer shareholders in Rugby REIT may elect to receive as
consideration: cash, ordinary shares in ING UK REIT and/or zero dividend
preference shares in IRET Securities Limited, a wholly owned subsidiary of ING
UK REIT ("ZDP's"). TCF and the Laxey Funds have undertaken to accept the Offer
and to receive ZDP's as consideration. The ZDP's are valued at 65p each on
issue (generating a total consideration of GBP13.7 million to TCF and the Laxey
Funds) which represents a premium of 71 per cent. to the average cost of
investment of 38p by TCF and the Laxey Funds. It also represents a premium of
41 per cent. to the price paid (41p) by TCF and the Laxey Funds for the shares
in Rugby REIT it acquired in October 2009.
In addition to participating in an innovative and tax efficient offer structure
which involves the issue of ZDP's as consideration under the Offer, TCF and the
Laxey Funds have agreed to sub-underwrite a placing of further ZDP's at 65p per
ZDP by ING UK REIT which will be used to fund the cash alternative available
under the Offer. Provided the Offer is declared unconditional, TCF and the
Laxey Funds will receive sub-underwriting commission of GBP493,000. The maximum
number of ZDP's that TCF and the Laxey Funds may be required to subscribe for is
37.9 million and in the case of TCF the maximum number of ZDP's it may be
required to subscribe for is 7.6 million.
The ZDP's are being issued at 65p per share and are due to be redeemed at
approximately 77p on 31 October 2012 which represents a gross redemption yield
of 6.875%. On issue the final amount payable on the redemption of the ZDP's
will be covered approximately five times by the net assets of the ING UK REIT
group. ING UK REIT has undertaken to use all reasonable endeavours to seek
admission of the ZDP's to the Official List of the UKLA and to trading on the
main market of the London Stock Exchange.
Laxey Partners commented:
"We are pleased that ING UK REIT has decided to make a takeover bid for Rugby
REIT. This once again demonstrates our ability to help facilitate transactions
and release value from our investments."
-ends-
Enquiries to:
Terra Catalyst Fund
Mike Haxby +44 (0) 1624 690900
Michael Allison
www.terracatalystfund.com Tel: +44 (0) 1624 690 900
Fairfax I.S. PLC
James King / Gillian McCarthy Tel: +44 (0) 20 7598 5368
NOTE TO EDITORS
Terra Catalyst Fund
Terra Catalyst Fund is a closed-ended Cayman Islands registered, exempted
company established to invest in listed property companies and funds in Europe,
with the objective of seeking to identify undervalued securities and actively
seeking to close the valuation gap between the value at which the security is
trading and its intrinsic value.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCGUGDSDXBBGGU
Rugby Est It (LSE:RUGB)
Historical Stock Chart
From Jun 2024 to Jul 2024
Rugby Est It (LSE:RUGB)
Historical Stock Chart
From Jul 2023 to Jul 2024
Real-Time news about Rugby Est It (London Stock Exchange): 0 recent articles
More Rugby Est It News Articles