GP surgery builder and landlord Assura (AGR) is to use the £175 million proceeds from a placing and open offer to fund a pipeline of 24 acquisitions and seven developments (24 Sep). The proceeds will also wipe £55 million off its debt pile.
The Warrington-based business is working to ease the burden on the NHS and has a national portfolio of purpose-built properties. This deal will expand its reach and, therefore, rental income and we expect the shares to respond in kind.
The real estate investment trust (Reit) specialises in purpose-built general practitioner premises and is raising some 60% of its £331.7 million cap to expand its estate. The funds will be generated through a £150 million placing and a £25 million open offer at a 6.9% discount to its 46.7p closing price (23 Sep).
Assura’s EPRA net asset value (NAV) stood at 45.1p in August, putting the stock on a 3.1% premium to net asset value (NAV), a gap that should narrow as its debt pile falls and new properties join its portfolio.
The fundraise is set for shareholder approval later this month (14 Oct). If investors give their consent Assura’s debt is set to fall to £482 million, sending its loan-to-value down to 52% from 65%.
Assura has stated its intention to ensure shareholders benefit from net asset improvements. It will increase its quarterly dividend by 11% from January. It returned 0.45p a share to investors in the second quarter of the year.