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Primary Health Properties raises funds to expand its portfolio

Published: 18:32 23 Mar 2018 AEDT

Doctor and patient
The group has taken its first steps into healthcare real estate in the Republic of Ireland

Primary Health Properties PLC (LON:PHP), the owner of medical centres and doctors' surgeries, is to raise up to £100mln by issuing shares at 114p.

The price represents a discount of 5.3p to last night's closing share price.

The company already has a firm commitment from institutional investors to take 46.3mln shares, raising £50mln.

READ: NHS woes highlight Primary Health Properties' strengths

A further 46.3mln shares will be issued, some of which will be placed in the market while some will be made available to existing shareholders.

Primary Health has the option of increasing the total size of the share issue (92.59mln) by up to 25% should there be sufficient demand.

Qualifying shareholders may subscribe new shares on the basis of 1 open-offer-share for every 17 shares held.

An excess application facility also exists, so shareholders may apply for more shares than their basic entitlement should they wish.

The capital raising will enable the company to grow its portfolio through selected property acquisitions while maintaining gearing at a conservative level and supporting its progressive dividend policy.

The board's medium to long-term target is to operate with gearing in the range of 45% to 65% of gross property value and in the short to medium term no higher than 60%.

"We believe there is a good understanding from governments in both the UK and the Republic of Ireland that it is important to deliver an increased number of health services from the local community and that investment in primary care premises can deliver value for money and better patient outcomes,” said Harry Hyman, the managing director of PHP. 

“The funds raised will be used to finance our existing identified acquisition targets, as well as our current pipeline of development and asset management opportunities which we are seeing in both the UK and in the Republic of Ireland," he added.


 

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