Capital & Regional, the co-investing property asset manager, has announced it is seeking to raise around 拢65 mln (EUR 73 mln) in new equity for its Junction fund. Under the terms of the transaction AREA Property Partners, formerly Apollo Real Estate, is proposing to provide the bulk of the funds - 拢50 mln - with the balance to be subscribed by a number of existing unit holders.
Capital & Regional, the co-investing property asset manager, has announced it is seeking to raise around 拢65 mln (EUR 73 mln) in new equity for its Junction fund. Under the terms of the transaction AREA Property Partners, formerly Apollo Real Estate, is proposing to provide the bulk of the funds - 拢50 mln - with the balance to be subscribed by a number of existing unit holders.
The retail and leisure investor said units will be issued at a price of around 18p, which represents a discount of around 40% to the net March unit price net of 29.7p. The issue is expected to close by the end of May and will be accompanied by changes in the fund's banking arrangements, including an increase in the loan-to-value (LTV) covenant to 90% until end-September 2010, and an extension of the facility to April 2014.
Hugh Scott-Barrett, Chief Executive said: 'I very much welcome AREA's proposed investment. Once completed, the new equity and the amendments to the banking arrangements will not only strengthen the Junction's financial position, but also enable its experienced management team to concentrate on asset management opportunities and allow the fund to benefit from the cyclical recovery of the sector over the next four to five years.'
