A fundraise, an insider purchase and yet another tender offer in this week’s
Frank Buhagiar
02 Jul, 2024

Regional REIT launches £110.5 million fundraise
Regional REIT (RGL) announced a £110.5 million capital raise via a fully underwritten Placing, Overseas Placing and Open Offer at 10p a share to repay a £50 million Retail Bond, reduce bank facilities and fund selective capital expenditure on assets. Winterflood explains, RGL ‘is seeking to raise more than double the amount needed to repay this bond in net proceeds, which could indicate Board concerns regarding potential breaches of other debt facility covenants or concerns over the ability to maintain the dividend over the medium term in the absence of earnings enhancements from CapEx.’

The 10p per share issue price represents a sizeable 82.3% discount to the latest published NTA per Share of 56.4p. Back to Winterflood, ‘The extent of the discount to EPRA NTA per share at which this fundraising will occur will clearly be highly dilutive to shareholders. We would expect shareholders to approve the fundraising at the EGM given that it should enable the fund to remain a going concern and continue its dividend payments, but suspect that this event may weigh on investor sentiment for some time. We continue to view RGL as a special situation.’

Cordiant Digital Infrastructure Chairman tops up holding
Cordiant Digital Infrastructure (CORD) Chairman and Co-Founder, Steven Marshall, purchased a total of 800,000 CORD shares at an average price of 78.7p per share on 20 June 2024. Not the first time Mr Marshall has dipped into his pockets to buy shares – he now owns a total of 9,075,200 ordinary shares in the fund.

Schroder Japan’s enhanced dividend
Schroder Japan’s (SJG) 24 June 2024 press release set out plans to adopt an enhanced dividend policy to pay out 4% of average net asset value in each financial year. Not that SJG hasn’t been generous when it has come to paying shareholders dividends. Over the last 10 years, the fund’s dividends have grown by 12.7% on an average yearly basis. But with dividends playing an increasingly important part of shareholder returns in Japan, the Board believes there’s scope to enhance the dividend policy further.

That’s not all. A new Conditional Tender Offer mechanism is also being proposed. If the fund does not perform at least in line with the Tokyo Stock Price Index Total Return in sterling terms over a five-year period starting from 31 July 2024, then the Board will put to shareholders a proposal for a tender offer of 25% of the issued share capital at a price equal to the prevailing net asset value less costs.

Numis: ‘Schroder Japan currently has a similar mechanism in place, whereby a tender for 25% of share capital is triggered if NAV total returns do not exceed the Topix by 2% pa over the four years to 31 July 2024, although this is highly unlikely to be triggered given the funds outperformance over this period.’

Bankers on course for 57th year of dividend growth
Bankers (BNKR) expects to increase its full-year dividend by at least 5%. If it does, and as explained in the Half-year Report, this would maintain the Company’s progressive dividend policy of successive annual dividend growth which it has achieved over the past 57 years.