CLS Holdings PLC Acquisition (0214O)
September 16 2013 - 2:00AM
UK Regulatory
TIDMCLI
RNS Number : 0214O
CLS Holdings PLC
16 September 2013
CLS Holdings plc
("CLS", the "Company" or the "Group")
Confirms the acquisition of 34 UK properties for GBP118.6
million
Further to the announcement made on 7 August 2013, and in the
Half-Yearly Financial Report on 14 August 2013, CLS confirms that
it has acquired a UK-wide portfolio of 34 primarily UK
Government-occupied properties (the "Portfolio") for GBP118.6
million, excluding costs of GBP5.3 million. The purchase of four
long leasehold properties in the Portfolio with an aggregate value
of GBP12.7 million is conditional on gaining landlord's
consent.
The Portfolio, the acquisition of which is classified as a Class
2 Transaction under the Listing Rules, was purchased through FRP
Advisory LLP in its capacity as receiver for certain subsidiaries
of Wichford plc. The consideration was satisfied in cash, following
the sale of the majority of the Group's corporate bond
portfolio.
78% of the rental income of the Portfolio is receivable from UK
Government bodies, including HM Revenue & Customs, Police
Authorities, Courts, the Immigration Service and the Department for
Work and Pensions, and 20% from Trillium (Prime) Property GP
Limited (a property outsourcing company providing services to the
UK Government). The Portfolio generates, net of ground rents, a
rental income of GBP15.1 million per annum, of which 66% is
index-linked. The Portfolio has a weighted average lease term of
7.2 years, or 4.8 years to the first break, and provides a net
initial yield after costs of 12.23%. The Portfolio is currently 99%
let.
The acquisition is in line with the Group's existing strategy of
opportunistically purchasing high-yielding, well-let office
properties with opportunities to add value through active property
management. The Portfolio will be proactively managed in-house in
order for the Group to meet its customers' needs most
efficiently.
Following the acquisition, 49% of the Group's total contracted
rent will be receivable from government occupiers, and 32% from
major corporations.
The process to provide medium-term financing of the Portfolio is
under way.
Sten Mortstedt, Executive Chairman of CLS Holdings plc,
commented:
"The acquisition of this portfolio will play to our core
strengths. It is well let to UK Government occupiers, adds GBP15.1
million per annum to our operating cash flow, and provides
significant opportunities to add value."
There is no further information to be issued pursuant to LR 10.4
(Class 2 requirements).
-ends-
For further information, please contact:
CLS Holdings plc +44 (0)20 7582 7766
www.clsholdings.com
Sten Mortstedt, Executive Chairman
Henry Klotz, Executive Vice Chairman
Richard Tice, Chief Executive Officer
Liberum Capital Limited +44 (0)20 3100 2222
Tom Fyson
Charles Stanley Securities +44 (0)20 7149 6000
Mark Taylor
Kinmont Limited +44 (0)20 7087 9100
Jonathan Gray
Smithfield Consultants (Financial PR) +44 (0)20 7903 0669
Alex Simmons
This information is provided by RNS
The company news service from the London Stock Exchange
END
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