TIDMRESI
RNS Number : 3577R
Residential Secure Income PLC
21 September 2017
21 September 2017
Residential Secure Income plc
UPDATE ON INVESTMENT PIPELINE
Residential Secure Income plc ("ReSI") (LSE: RESI), which
invests in residential asset classes that comprise the stock of UK
social housing providers, is pleased to announce that significant
progress on the investment pipeline has been made by ReSI Capital
Management Limited (the "Fund Manager") in the period since its IPO
in July 2017.
In particular, the Fund Manager is in the process of finalising
terms with three Housing Associations for the acquisition of three
separate Shared Ownership portfolios in Southern England for a
total consideration of approximately GBP250 million. It is
currently expected that these transactions will be contracted by
the end of 2017, or shortly thereafter. The Fund Manager expects
that long term investment grade equivalent debt will be raised on
or shortly after each respective acquisition date in line with
ReSI's investment strategy.
In addition, the Fund Manager has entered into exclusive due
diligence in respect of the acquisition of, in aggregate,
approximately GBP100 million of Rental Homes which are managed by a
Housing Association and principally located in Southern England.
This transaction is expected to contract during November 2017,
subject to final due diligence. The Fund Manager has received long
term investment grade equivalent debt funding offers for this
acquisition.
The Fund Manager is also progressing a further pipeline of
Shared Ownership Homes and Rental Homes with three other Housing
Associations with an aggregate purchase consideration of over
GBP200 million.
ReSI therefore expects that the net proceeds of the IPO, plus
leverage, will be fully deployed well within the nine month period
referred to in ReSI's IPO prospectus.
FOR FURTHER INFORMATION, PLEASE CONTACT:
ReSI Capital Management Limited
Jonathan Slater, Chief Executive
Ken Youngman, Chief Financial Officer
Ben Fry, Investment Manager
Alex Pilato, Director +44 (0) 20 7382 0900
Jefferies International Limited
Stuart Klein
Gary Gould +44 (0) 20 7029 8000
FTI Consulting +44 (0) 20 3737 1000
Richard Sunderland Email: resi@fticonsulting.com
Claire Turvey
Richard Gotla
NOTES:
Residential Secure Income plc (LSE: RESI) is listed on the
premium segment of the Official List of the UK Listing Authority
and was admitted to trading on the Main Market of the London Stock
Exchange in July 2017.
ReSI has been established to invest in portfolios of Homes
across residential asset classes that comprise the stock of Housing
Associations and Local Authorities, comprising Shared Ownership
Homes and Rental Homes (being Market Rental Homes, Functional Homes
and Sub-Market Rental Homes) throughout the UK.
ReSI is managed by ReSI Capital Management Limited, a wholly
owned subsidiary of TradeRisks Limited which has a 16 year track
record of executing transactions within the UK social housing
sector and, to date, has arranged funding of over GBP10 billion in
the social housing, care and other specialist residential property
sectors.
ReSI seeks to deliver secure, long-dated, inflation-linked
income returns through investment in UK social housing. It aims to
meet demand from Housing Associations and Local Authorities for
alternative equity-like financing sources that allows them to
recycle capital back into socially and economically beneficial new
housing, making a meaningful contribution to the UK housing
shortage.
Homes acquired by ReSI will predominantly be on a freehold or
long leasehold basis (typically 99 years or more to maturity) and
benefit from long term (typically 20 years plus) inflation-adjusted
cash flows. Acquisitions by ReSI will be limited to Homes with
sufficient cashflows, counterparty credit quality and property
security that allow the Fund Manager to arrange long-term
investment grade equivalent debt.
ReSI is targeting, on a fully invested and geared basis, a
dividend yield of 5% per annum based on the issue price of 100
pence per Ordinary Share, which ReSI expects to increase broadly in
line with inflation, and a total return in excess of 8% per
annum(1) .
1. This is a target only and not a profit forecast and there can
be no assurance that it will be met.
Further information on ReSI is available at
www.resi-reit.com
IMPORTANT INFORMATION:
Save to the extent otherwise defined herein, terms used in this
announcement shall, unless the context otherwise requires, bear the
meanings given to them in the prospectus published by ReSI dated 22
June 2017.
This announcement may include statements that are, or may be
deemed to be, "forward-looking statements". These forward-looking
statements involve known and unknown risks and uncertainties, many
of which are beyond ReSI's control and all of which are based on
ReSI's board of directors' current beliefs and expectations about
future events. These forward-looking statements may be identified
by the use of forward-looking terminology, including the terms
"believes", "estimates", "plans", "projects", "anticipates",
"expects", "intends", "may", "will" or "should" or, in each case,
their negative or other variations or comparable terminology, or by
discussions of strategy, plans, objectives, goals, future events or
intentions. These forward-looking statements include all matters
that are not historical facts. Forward-looking statements may and
often do differ materially from actual results. Any forward looking
statements reflect ReSI's current view with respect to future
events and are subject to risks relating to future events and other
risks, uncertainties and assumptions relating to ReSI's business,
the results of operations, financial condition prospects, growth
and dividend policy of ReSI and the industry in which it operates.
Forward-looking statements speak only as of the date they are made
and cannot be relied upon as a guide to future performance. ReSI
expressly disclaims any obligation or undertaking to update, review
or revise any forward-looking statement contained in this
announcement whether as a result of new information, future
developments or otherwise.
Each of the potential acquisitions noted in this update is
subject to satisfactory completion of negotiations and due
diligence by the Fund Manager and its professional advisers and
there can be no certainty that the ReSI will complete any of these
acquisitions.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCZMGZLNGDGNZM
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