Primary Healthcare plans £60m placing to fund property spree

PRIMARY Healthcare Properties (PHP) yesterday announced its intention to raise £60m through a share placing.

The firm, which buys primary health care premises and leases them back to NHS doctor surgeries, said that it planned to issue almost 20m new shares at 315p – a 6.3 per cent discount to the current share price.

The firm said the proceeds would enable it to purchase more properties.

It said it had identified a pipeline of 22 potential properties worth £99.2m.

“This pipeline is indicative of the attractive long term investment opportunities that exist for the company,” it said in a statement.

Existing shareholders will be able to participate in the offering on the basis of one open offer share for every ten existing ordinary shares they own.

If demand exceeds the proposed offering, Primary Healthcare said it could increase the size by up to 25 per cent.

Harry Hyman, managing director of PHP said it had already managed to secure financing at attractive margins. “Our purchase of the AMP portfolio in December, and subsequent refinancing of the associated debt facilities, demonstrates our ability to identify and execute earnings enhancing acquisitions,” he said.

Hyman said the capital raising would allow the business to continue to grow.

Dealings in the new shares, subject to approval at a general meeting, are expected to start on 13 June. Its shares fell 3.5 per cent yesterday to close at 324.5p, giving it an estimated market capitalisation of £246.73m.

Numis and Peel Hunt are underwriting the placing.