Cromwell to take up rights and grow AUM
Cromwell has undertaken to subscribe in full for its pro-rata entitlement under the proposed rights issue announced by Cromwell European REIT (CEREIT) to the Singapore Exchange Securities Trading Limited (SGXST) on 30 October 2018.
Acquisition
CEREIT announced a rights issue to partially fund the acquisition of 23 assets in five European countries for a total of €384.4 million.
The proposed acquisition consists of 16 office assets in the Netherlands, Finland and Poland for a total purchase consideration of €312.5 million (Proposed Acquisition), along with the acquisition of seven office, logistics and retail assets in Italy and France for a total of €71.9 million.
Financing
The new assets will be partially financed through the rights issue, under which CEREIT is seeking to raise up to €224.1 million, with the remainder of the purchase consideration financed by debt.
The Proposed Acquisition and rights issue were approved at an Extraordinary General Meeting of CEREIT unitholders, held on 15 November 2018.
Through its wholly owned subsidiaries, Cromwell currently holds interests equivalent to 35.31% in CEREIT, and has undertaken to subscribe in full for its pro-rata entitlement, funding the take-up through cash reserves and other existing sources.
Increased resilience from enlarged size and diversification
Cromwell CEO Paul Weightman commented, “Cromwell is fully supportive of CEREIT, and the Manager, and is delighted to take up this entitlement. The additional investment is fully consistent with our stated ‘Invest to Manage’ strategy of growing our funds management business.”
“The transaction increases CEREIT’s total portfolio value from approximately €1.4 billion to €1.8 billion, enhancing the size, scale and diversification of the portfolio,” he noted.
