EUROPEAN warehouse operator PointPark Properties yesterday announced plans to raise £250m in a float on the London Stock Exchange, marking the first IPO in the real estate sector for two years.
The property group said it plans to use the proceeds to buy a €760m (£612m) portfolio of properties that it currently manages on behalf of its parent company Arcapita, the Bahrain-based investment bank.
Arcapita filed for bankruptcy in the US this year after failing to reach an agreement over a $1.1bn ($688m) debt repayment with creditors.
Under the terms of the offering, being run by Deutsche Bank and Credit Suisse, PointPark Properties will issue Arcapita with a 15 per cent equity stake in the listed-group.
The Czech-based company, also known as P3, said money raised from the offering would also be used to reduce the debt attached to this portfolio as well as to fund growth.
The group owns 46 warehouses, providing services to logistics, retail, automotive and electronics companies across Europe. Its portfolio has annual rents of €61m and an occupancy rate of 88 per cent.
It first emerged as property developer Pinnacle that was set up in Prague in 2001 and later acquired by Merrill Lynch in 2007, before being bought out by Arcapita two years later.
“We started looking at this IPO two years ago,” chief executive Ian Worboys told City A.M. “We have been waiting for the markets to be in a situation where we could float.”
He said the company had carried out “pilot fishing” activities to test the market sentiment and was pleased with the feedback from potential investors.
“The logistics market is one of the few markets to show long term growth... We don’t have the peaks and troughs of the retail market and we can provide long term steady income,” Worboys said.
Deutsche Bank is acting as joint global co-ordinator and joint bookrunner for PointPark, with Christopher Laing, head of equity capital markets, leading the team. PointPark is Laing’s third IPO this year after he advised NMC Capital, the Abu Dhabi health services provider, on its £117m London flotation in April. In June, he acted as bookrunner to South African financial services company Transaction Capital, which listed on the Johannesburg market, raising 400m rand (£29m). Laing joined the firm in 1995 and has since piloted some of the biggest deals in Gulf financial history, including Dubai Port World’s $4.2bn IPO in 2007 and Kingdom Hotel Investments’ $397m float – notable for being the first ever listing on the Dubai International Financial Exchange. He is joined on the PointPark deal by real estate director John O’Driscoll and Ben Lawrence from DB’s corporate broking team. Credit Suisse has also been appointed joint-bookrunner and joint-global co-ordinator. Wenceslao Bunge, head of real estate investment banking, was joined by equity capital markets managing director Nick Koemtzopoulos and head of equity syndicate Stephane Gruffat on the deal, alongside Chris Byrne from the bank’s UK investment banking team.