UK Mortgages Ltd UKML Fifth Transaction

 
TIDMUKML 
 
THE INFORMATION IN THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR PUBLICATION, 
RELEASE OR DISTRIBUTION DIRECTLY OR INDIRECTLY IN OR INTO OR FROM THE UNITED 
STATES, CANADA, AUSTRALIA, THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF 
IRELAND OR JAPAN. 
 
2 October 2018 
 
                             UK MORTGAGES LIMITED 
 (a closed-ended investment company incorporated in Guernsey with registration 
                                number 60440 ) 
                           LEI 549300388LT7VTHCIT59 
 
                               Investment update 
 
UK Mortgages Limited - Fifth Transaction Completion 
 
2 October 2018 
 
The Board of UK Mortgages Limited ("UKML", or the "Company") and TwentyFour 
Asset Management LLP ("TwentyFour") are pleased to announce the successful 
completion of the previously announced forward flow purchase arrangement with 
Keystone Property Finance Limited ("Keystone"). Under this investment Keystone 
will originate a book of Buy-to-Let ("BTL") mortgages, into a warehouse 
financing structure. 
 
The transaction was originally announced on the 20th June 2018 and TwentyFour 
have subsequently appointed National Australia Bank (rated Aa3/AA-/AA- with 
Moody's, S&P and Fitch) as both financing and swap provider and Pepper UK as 
servicer, along with assigning a number of ancillary roles to counterparties 
already performing the same functions for existing UKML transactions. The terms 
of the financing agreement, exclusive purchase agreement, detailed origination 
criteria, and ongoing loan management all form part of the arrangement for 
which documentation has been negotiated throughout the summer and has now been 
fully signed. 
 
The transaction provides a second ongoing growth channel for the Company and is 
expected to generate a gross Internal Rate of Return ("IRR") significantly in 
excess of 7% (from the date of purchase). 
 
Importantly, following the initial allocation of part of the new capital raised 
in June 2018, further capital will be raised as required on an incremental 
basis in future periods, thereby using capital in the most efficient manner 
within the conservative leverage constraints of the Company, and improving the 
income contribution. As previously announced, the Company is also seeking to 
put in place a revolving credit facility to give greater flexibility in 
managing capital, which will further optimise returns. 
 
Keystone operates in the specialist BTL market focussing on professional 
landlords and more complex cases, differentiating it from existing investments 
such as those backed by Coventry Building Society BTL loans, who mainly target 
individual property investors, as well as complementing the Company's existing 
owner-occupied forward flow arrangement with The Mortgage Lender. Keystone was 
formed in 2007 and has been an active lender in its current form since 2012, 
with similar agreements for its previous funding partners. Keystone's initial 
marketing has created an active pipeline at the point of completing the 
transaction, and early interest has been encouragingly strong. 
 
Further information: 
 
TwentyFour Asset Management LLP 
Douglas Charleston 
020 7015 8900 
 
Numis Securities Limited, Corporate Broker 
Nathan Brown 
 
Hugh Jonathan 
020 7260 1000 
 
Important notice 
 
This announcement has been prepared for information purposes only, it is not a 
prospectus. 
 
The distribution of this announcement in certain jurisdictions may be 
restricted by law. Persons into whose possession this announcement comes are 
required by the UKML, TwentyFour and Numis to inform themselves about, and to 
observe, such restrictions. 
 
Certain statements in this announcement are forward-looking statements which 
are based on UKML's expectations, intentions and projections regarding its 
future performance, anticipated events or trends and other matters that are not 
historical facts.  These statements are not guarantees of future performance 
and are subject to known and unknown risks, uncertainties and other factors 
that could cause actual results to differ materially from those expressed or 
implied by such forward-looking statements. TwentyFour's estimate of the 
potential gross IRR for this investment is calculated based on certain 
scenarios and subject to certain assumptions. This and any other references 
herein to potential future returns or distributions are targets and not 
forecasts and there can be no guarantee or assurance that they will be 
achieved.  Given these risks and uncertainties, prospective investors are 
cautioned not to place undue reliance on forward-looking statements. 
Forward-looking statements speak only as of the date of such statements and, 
except as required by applicable law, UKML undertakes no obligation to update 
or revise publicly any forward-looking statements, whether as a result of new 
information, future events or otherwise. 
 
The information contained in this announcement is subject to change without 
notice and neither the UKML, TwentyFour nor Numis assume any responsibility or 
obligation to update publicly or review any of the forward-looking statements 
contained herein. 
 
Recipients of this announcement who are considering acquiring New Shares in 
UKML are reminded that any such acquisition must be made only on the basis of 
the information contained in the Prospectus and any supplementary prospectus 
(es) thereto which may be different from the information contained in this 
announcement.  This announcement does not constitute or form part of and may 
not be construed as an offer to sell, or an invitation to purchase, investments 
of any description, nor as a recommendation regarding the possible offering or 
the provision of investment advice by any party.  No information in this 
announcement should be construed as providing financial, investment or other 
professional advice and each prospective investor should consult its own legal, 
business, tax and other advisers in evaluating any investment opportunity.  In 
particular, an investment in UKML involves a high degree of risk and 
prospective investors should read the section in the Prospectus entitled "Risk 
Factors" for further information. 
 
 
 
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