RDI REIT loses bid agrees standstill with Aviva – Yesterday evening the board of RDI REIT released the following announcement:
“The Board of RDI notes the announcement by Cromwell that it does not intend to make an offer for RDI and that it is consequently bound by the restrictions under Rule 2.8 of the City Code on Takeovers and Mergers (the “Code”).
Since the initial unsolicited approach from Cromwell, the Board has actively engaged with Cromwell in order to facilitate its due diligence requirements. However, following such engagement, the Board recently received a conditional proposal from Cromwell. The Board considered the proposal to undervalue the Company and its prospects and, as a result, the Board took the unanimous decision not to support a further period of due diligence.
The Board has also received confirmation from Redefine Properties Limited, the Company’s largest shareholder, that the proposal was unacceptable to it.
The Board welcomes the clarification provided by the announcement from Cromwell and looks forward to updating its shareholders at its half year results on Thursday 25(th) April.”
And this morning RDI REIT said:
“Further to the announcement on 8 April 2019 in respect of the Aviva Shopping Centre facility, a standstill period has been agreed to 11 October 2019, during which time Aviva has confirmed that it will not take any action to accelerate its security under the facility agreement (the “Standstill Agreement”). RDI and Aviva have agreed to progress a consensual sales process or restructuring of the facility during this standstill period. Notwithstanding the Standstill Agreement, Aviva will retain all of its rights under the facility agreement.
As previously announced, all net operating cashflows after interest costs of approximately GBP6.5 million (on an annualised basis) will be retained within the facility. The facility is non-recourse to the Company and RDI will not be required to provide further cash in respect of this facility during the period of the Standstill Agreement. Occupancy across the portfolio is 94.5%.”
[Cromwell acknowledged that RDI’s board thought its bid undervalued the company and withdrew. RDI’s shares fell on the news but RDI will now be hoping that it can sell the shopping centre portfolio that the Aviva debt facility is secured against for more than the value that Aviva has put on it. Shopping centres are not in great demand an so it will be interesting to see whether RDI can pull this off.]
RDI : RDI REIT loses bid agrees standstill with Aviva