Shaftesbury raises 149.1m

David Hellier
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PROPERTY firm Shaftesbury has launched a 2-for-3 rights issue to raise &pound;149.1m to spruce up London&rsquo;s fashionable Soho district.<br /><br />The real estate investment trust, which owns large swathes of the capital&rsquo;s Chinatown and Covent Garden theatre district, plans to sell about 90.3m shares at 175p each, a discount of 53.1 per cent to the closing price on Tuesday.<br /><br />Sources close to the deal said the issue was &ldquo;offensive rather than defensive,&rdquo; meaning that the group wanted the funds to further expand its portfolio of assets rather than to use them to repay bank borrowings.<br /><br />&ldquo;This rights issue will allow us to take advantage of excellent opportunities that are emerging to make strategic acquisitions in keeping with our long term investment strategy,&rdquo; chief executive Jonathan Lane said in a statement.<br /><br />&ldquo;We believe that the acquisitions funded by this rights issue will deliver good returns for our shareholders,&rdquo; he said.<br /><br />The company said it would earmark the remaining funds to buy discounted properties in its core markets, where real estate is rarely offered for sale in buoyant economic conditions.<br /><br />Shaftesbury said that it had already begun acquiring properties in and around Chinatown and the Berwick Street market area in Soho.<br /><br />Despite the general economic downturn, the group said its business was performing well. Its net rental income was &pound;27.2m for the six months ended 31 March 2009, an increase of &pound;1.2 m or 4.6 per cent compared with the six months ended 31 March 2008. The group&rsquo;s net asset value per share is 393p, compared with 578p last year.&nbsp;