Al Mal Capital REIT, the first real estate investment trust listed on DFM, has announced plans for a significant rights issue that will be launched on March 4.
AMCREIT is managed by Al Mal Capital, a subsidiary of Dubai Investments, and has an existing portfolio size of AED580 million, invested in a diversified portfolio of income-generating educational assets in the UAE.
The fund has an investment strategy focused on strong-performing sectors such as healthcare, education, and industrials. This is based on secure long-term lease agreements with strong credit profile operators, offering UAE and GCC investors access to an asset class with strong value creation fundamentals – generating a target return of 7%.
The IPO comes following the go-ahead from the UAE’s Securities and Commodities Authority (SCA), said the Dubai Investments unit, adding that the proceeds raised will fund the acquisitions of additional income generating educational and healthcare assets, which inturn will strengthen AMCREIT’s portfolio and help create sustainable value for unitholders.
According to Al Mal Capital, the issuance will deliver a maximum of 400 million new units to existing unitholders at a price of AED1.1 per share - increasing the share capital by 114% to AED750 million, in addition to raising AED40 million via issue premium, totalling aggregate unitholders’ equity of AED790 million following the capital increase.
The capital raised by the rights issue will further enhance AMCREIT’s offering, by acquiring strategic and high potential assets in specified sectors, diversifying the REIT’s portfolio, and enhancing overall stability, generating further yield on behalf of investors, it stated.
On the strategic move, Al Mal Capital CEO and Vice Chairman Naser Al Nabulsi said: "This significant rights issue is an important step in our journey to generate consistent and sustainable value for our investors, solidifying our position as a leading real estate asset manager and investor in the Gulf."
"We recognise that there are significant untapped opportunities in the commercial real estate sector, and we remain focused on identifying and acquiring those assets that are strategically aligned with our vision. We pride ourselves on our performance, consistently delivering robust growth and yield. This transaction heralds the next stage of our growth journey as we look to continue delivering value for investors in the Gulf," he added,
The Emirati group said the rights issue entitles all AMCREIT unitholders to subscribe to the newly issued units – with each subscribing unitholder to be issued 1 ‘right’ for every .875 units of ownership at a subscription price of 1.1 AED per unit.
Unitholders’ will also be entitled to sell these rights to other interested investors on the Dubai Financial Market during the trading of rights period which is scheduled to begin on February 26.-TradeArabia News Service
