The Wellcome Trust has announced that terms have been agreed with the Board of Urban&Civic (UANC) for a recommended cash offer by Wellcome for the entire issued and to be issued share capital of UANC at 345p per share. The announcement provides the following key highlights of the deal:
- Under the terms of the Acquisition, which values Urban&Civic’s issued and to be issued share capital at £506.0 million, UANC Shareholders will be entitled to receive 345 pence in cash for each Urban&Civic Share.
- The Acquisition Consideration represents:
- a premium of 63.5 per cent. to the Closing Price of 211.0 pence per Urban&Civic Share on 5 November (being the last Business Day before this announcement);
- a premium of 65.3 per cent. to the volume weighted average Urban&Civic Share price of 208.7 pence over the last one month;
- a premium of 53.8 per cent. to the volume weighted average Urban&Civic Share price of 224.3 pence over the last six months;
- full recognition of Urban&Civic’s unaudited EPRA NAV of 343.2 pence per share at 30 September 2020.
- If, on or after the date of this announcement, any dividend and/or other distribution and/or return of capital is declared, made or paid or becomes payable by Urban&Civic, Wellcome reserves the right to reduce the consideration payable under the terms of the Acquisition for the Urban&Civic Shares by an amount up to the amount of such dividend and/or other distribution and/or return of capital, in which case any reference in this announcement to the consideration payable under the terms of the Acquisition will be deemed to be a reference to the consideration as so reduced. In such circumstances, Urban&Civic Shareholders would be entitled to retain any such dividend and/or other distribution and/or return of capital.
- It is intended that the Acquisition will be implemented by means of a Court-sanctioned scheme of arrangement under Part 26 of the Companies Act.
Support from J O Hambro Capital Management
In addition to the board of Urban& Civic endorsing the offer, J O Hambro Capital Management has given an irrevocable undertaking to vote in favour of the Scheme. This apples in respect of 6,933,001 UANC Shares and representing approximately 4.8 per cent. of Urban&Civic’s issued share capital on 5 November 2020. It has also provided a letter of intent to vote in favour of the Scheme in respect of 2,666,539 Urban&Civic Shares (which represents approximately 1.8 per cent. of Urban&Civic’s issued share capital)
Comments Peter Pereira Gray, Managing Partner and Chief Executive Officer of the Investment Division of Wellcome
“We are very pleased to announce this recommended offer, which is fully aligned with our existing strategy of investing in businesses over the long term. The offer by Wellcome for Urban&Civic represents a compelling value proposition for Urban&Civic’s shareholders at an attractive and certain value in cash today, reflecting the high quality of the business, its people and its future prospects. We know the Urban&Civic business and its experienced management team from our recent joint venture together. We welcome Urban&Civic’s management and employees to Wellcome and look forward to working with them to invest in and develop the business further. We believe that the two groups’ complementary strengths will create a business well-equipped to deliver Urban&Civic’s long-term potential.”
Comments from Alan Dickinson, Chairman of Urban&Civic
“The proposal rests on comprehensive industrial logic. Urban&Civic was established just ten years ago with the specific intention of disrupting prevailing residential presumptions and now leads in strategic site Master Development. Wellcome is steeped in property experience and has a strong record of alternative asset class investment.
The acquisition provides a persuasive outcome for all stakeholders. A cash offer above up-to-date NAV outperforms the FTSE 350 Real Estate Index by some 70 per cent since listing in 2014 and secures returns for our loyal and supportive specialist shareholder base, much of which has been with us for the whole journey. Comprehensive alignment with the objectives of Homes England and respective local authorities will be maintained and reinforced. The growing residential communities that are being created by Urban&Civic, with the involvement of valued and reputed partners, can all be confident in a continued determination to do things right. Finally, the move is especially timely as the Government consults on its Planning White Paper. The introduction of additional patient institutional capital is a key component of successful large site delivery to meet identified housing need.”