- Centuria Office REIT (COF) completes the institutional segment of its major $201 million capital raising plan
- The company is set to pocket $129 million from institutional investors who were offered one new share for every 6.4 already held at $2.50 each
- The remaining $72 million will come from the retail segment of the capital raise, which gives mum and dad investors the same offer
- Centuria says the funds will help the company buy two major office buildings: one in South Melbourne and one in St Leonards, New South Wales
- Shares in Centuria Office REIT close 3.86 per cent lower at $2.49 per share
Centuria Office REIT (COF) has completed the institutional segment of its major $201 million capital raising plan announced this week.
The company is set to pocket $129 million from the first part of the entitlement offer, which gave institutional investors the opportunity to buy one new share for every 6.4 already held at $2.50 apiece.
COF said the entitlement offer was well-supported by shareholders, with a takeup of roughly 90 per cent by eligible shareholders. This is not including COF’s fund management arm, Centuria Capital Group, which subscribed for its entitlement of $25.5 million.
Further, COF said the shortfall from the institutional raise attracted demand from both existing and new shareholders.
New shares issued under the institutional segment of the entitlement offer will settle on Wednesday, September 15.
This means Centuria is now set to open the retail segment of its entitlement offer on Monday, September 13.
The retail offer will give mum and dad investors the chance to buy new shares in COF on the same terms as the institutional offer. The $2.50 offer price represents a 3.5 per cent discount on Centuria’s last closing price of $2.59 per share.
Centuria plans to book $72 million from the retail segment of the entitlement offer.
Why the raise?
Centuria announced the capital raise on Monday alongside plans to buy two major office buildings: one in South Melbourne and one in St Leonards, New South Wales.
The South Melbourne property comes with a $205.1 million price tag, while Centuria will pay $68 million for the New South Wales office building.
COF fund manager Grant Nichols said the “strategically located” buildings offer excellent surrounding tenant amenity and accessibility.
“The acquisitions are strongly aligned with COF’s stated strategy and deliver several benefits including broader geographic diversification, high occupancy, young assets with sustainable and affordable rent profiles and an enhanced portfolio WALE,” Mr Nichols said.
Shares in Centuria Office REIT came out of a trading halt this morning and quickly retreated to just below the entitlement offer price. The company closed 3.86 per cent lower at $2.49 per share.