STANDARD Life yesterday announced it is to invest in a £165m portfolio of 22 UK commercial properties in a bid to diversify its shareholder base.
The company said it would raise up to £75m in debt to fund the cash purchase, and was already in discussion with potential lenders. The remaining cash would be provided by a shares issue, which the company expected to place at a premium to the current net asset value per share of 77.3p.
The potential acquisition is subject to due diligence on the acquisition and shareholder approval.
The company said it wanted to avoid having a few large, dominant shareholders, and hoped the new portfolio would help to attract new investors.
Chairman Dick Barfield said in a statement: “The acquisition would strengthen the company’s dividends and following a successful placing of new shares the liquidity in the company shares should increase and make the company more attractive to a wider audience of investors.”
Investment manager Brewin Dolphin is the largest investor in Standard Life’s property division, followed by Heartwood.
The potential portfolio, which is currently owned by a Jersey property trust, is largely office and industrial properties, similar to Standard Life’s current holdings.
The FTSE 100 group’s existing property portfolio is made up of 45 assets, including White Bay Yard offices in Farringdon, and real estate accounts for £12.4bn of over £302bn assets under Standard Life’s management, which makes it one of Europe’s largest property investors.