Care home investor Target Healthcare REIT has announced its intention to raise £50m through a placing to fund new acquisitions.
The issue price of 111p per share represents a discount of 4.8% to last night’s closing price of 116.6p and a 2.6% premium to its last reported EPRA net asset value (NAV) of 108.2p (at 31 December 2020).
The group has an investment pipeline worth £224m, with £47m identified as imminent acquisition assets consisting of three operational care homes and one forward funding project.
A further £177m of near-term pipeline assets have also been identified by the investment manager, consisting of 10 operational care homes, five forward funding projects and one forward commitment to purchase a pre-let care home on completion of the development.
In conjunction with the issue, the group said it intends to implement a placing programme to enable it to raise additional equity through the issue of up to 150 million new shares in the 12 month period from 4 March 2021.
The company said its portfolio had demonstrated defensive characteristics during the pandemic, with the collection of rent being unaffected.
By 1 February, vaccinations had been offered to all of the residents and staff at its 76 care homes, with substantial take up. The group said this should allow for increased admissions and safer visits, enabling increased occupancy.
The group’s annual dividend target for the year ending 30 June 2021 is 6.72p per share, which gives an implied dividend yield of 6.1% on the issue price.
The initial placing is planned to close on 25 February 2021 and admission of the new shares planned for 3 March 2021.
THRL : Target Healthcare REIT to raise £50m in placing