EJF Investments Limited (EJFI) has announced the launch of a RetailBook offer for its new 2029 zero dividend preference (ZDP) shares, offering eligible UK retail investors an opportunity to participate in the issuance on equivalent terms to institutional investors.
The issue price for the 2029 ZDP shares under the RetailBook offer has been set at 100.1566p per share, reflecting capital accrual since the institutional placing was priced at 100p. This ensures that investors participating via RetailBook will receive a gross redemption yield (GRY) of 8.5% per annum to the 2029 maturity date, aligning with the return available through the institutional tranche.
The RetailBook offer is open to investors via a network of participating retail brokers, platforms and wealth managers, including Hargreaves Lansdown, interactive investor, and AJ Bell (subject to their individual participation and eligibility requirements). The minimum subscription has been set at £50, and no commission will be charged to investors by RetailBook for applications made through the platform.
This retail offering runs alongside the company’s previously announced institutional placing and a rollover offer for holders of EJFI’s existing 2025 ZDP shares, as part of a broader issuance programme for up to 28m 2029 ZDP shares in total. While the RetailBook offer is not part of the institutional or rollover offers, its completion is conditional upon those tranches being successfully admitted to trading on the specialist fund segment of the London Stock Exchange. First admission of the institutional and rollover shares is expected at 8am on 14 May 2025, with the second admission (for RetailBook participants) scheduled for 21 May 2025.
The net proceeds from the issuance will be used to support EJFI’s ongoing investment strategy, which targets attractive risk-adjusted returns by investing in a diversified portfolio of loans issued by financial institutions and similar assets, predominantly across the US, UK and Europe. The company aims to deliver a combination of capital growth and regular income for its ordinary shareholders over the long term.
The RetailBook offer provides a direct route for UK retail investors to access structured capital instruments typically reserved for institutional buyers. It reflects an industry trend towards democratising capital market access, as seen in similar initiatives across the investment trust space.
The offer is expected to close at 2pm on 19 May 2025, though the company reserves the right to close it earlier or scale back applications in the event of strong demand. Investors are advised to consult their platform or broker regarding eligibility, particularly for investments held within ISAs, SIPPs or GIAs.
[QD comment MR: We welcome efforts like this RetailBook offer that aim to give retail investors the same access to fundraisings that institutions benefit from and on the same terms.
ZDPs have long been used in the investment trust space and the 8.5% gross redemption yield (GRY), with a minimum of 3x coverage (at the time of issue) looks attractive, particularly given the company’s focus on secured, asset-backed exposures in financials.
However, as always, it’s important for retail investors to have a clear understanding of the structure and the risks before investing. In this instance, while ZDPs offer a fixed return and rank ahead of ordinary shares in the capital structure, their returns are not without risk – particularly if the underlying assets underperform or if the company faces difficulty meeting its liabilities at maturity. Also, despite being labelled a retail offer, eligibility criteria still apply: EJF is listed on the Specialist Fund Segment (SFM) of the London Stock Exchange, which not all platforms will let you invest in.]
