Shopping Centres Australasia Property Group (ASX: SCP) Raises Capital For $573 Million Acquisition Of Vicinity Portfolio

SCA Property Group today announced the acquisition of $573 million Vicinity portfolio which will include the takeover of ten convenience-based retail centres from Vicinity Centres (ASX: VCX). The group told that the acquisition would be funded by equity raising via institutional placement and Unit Purchase Plan (UPP), new debt facility, and the divestment of CQR units.

The purchase consideration of $573 million represents a 7.47% of initial yield on a fully-let basis. The ten new assets would include Lavington Square and West End Plaza in New South Wales, Stirlings Central and Warnbro Centre in Western Australia, Currambine Central, Kalamunda Central, Bentons Square and The Gateway in Victoria, North Shore Village and Oxenford Village in Queensland.

To weight back this acquisition the group is set to raise capital of approximately $259 million from institutional investors. SCA Property Group told it will undertake the fully underwritten placement for 15% of the total units outstanding at $2.29 per unit, reflecting a 3.4% discount to the recent close. It will further raise $50 million via non-underwritten Unit Purchase Plan to eligible unitholders in Australia and New Zealand for subscription of up to $15,000 of additional New Units. Meanwhile, in support of this takeover the company has sold 3.7 million units of CQR at an average price of $4.27 per unit, raising $15.6 million. SCP further intends to divest the balance of its CQR stake over the next 12 months. As per the company’s information, a new debt facility of up to $365 million is also to be arranged to fund the takeover. 

Let’s see what does these ten convenience-based retail centres bring along with us.

Post-acquisition, company’s FY19 FFO guidance is expected to increase from 15.6 cents per unit to 16.2 cents per unit, while annualized pro-forma FY19 FFO per unit is expected to increase by more than 5%. It has also been forecasted that FY19 Distribution guidance will grow to 14.7 cents per unit from previous 14.3 cents per unit. Also, NTA per unit may fall from $2.30 to $2.25. Pro-forma gearing is expected to be 34.1%, remaining within the target range of 30 – 40%.

If this deal goes through, Shopping Centres Australasia Property Group will become the largest convenience-based retail specialist in Australia holding more than $3.1 billion of convenience-based shopping centres portfolio. However, as per the terms of agreement the deal is said to be conditional on the completion of capital raising by the SCA Property Group. It has been understood that on the completion of successfully Placement by SCA Property Group, the transaction could be settled as early as the later this month.

Before the release of an acquisition announcement the company went into a trading halt. In a market announcement, Australian Securities Exchange confirmed the trading halt of SCA Group’s securities which is expected to remain in place until the earlier of 5 October 2018 or the release of market announcement as intended by the company in relation to outcome of the Placement.

Currently, (3 October 2018; 1:36 PM) the stock of Shopping Centres Australasia Property Group is lying in trading halt. It last traded at $2.370 after dipping down by 1.25% on 2 October 2018.

Dividend Stocks To Buy

The Income available from dividends remains attractive for many investors.

We take a look at the best yields on the market and assess what they say about a company’s prospect.

One Thing is certain, though, Australia interest rates are still low, making income difficult to come by and keeping the focus for many investors on high yielding stocks. Kalkine’s team of analysts bought you handpicked report for “Top 25 Dividend Stocks For 2018.”

ASX-relevant Special Reports are published year-round to provide a detailed analysis into an investing opportunity or a potential risk to your portfolio.

Click here to get your free report.


Disclaimer

The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkinemedia.com and associated websites are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.

Join Our Discussion

Start discussion with value Investors for ASX Stock Market Investment and Opinion.


6 Cannabis Stocks under Investor’s Limelight…

Cannabis companies that sell both medicinal weed and recreational pot. Marijuana stocks to look at. Marijuana mergers and acquisitions. Dispensary data analytics. Upcoming marijuana IPO’s Those phrases have become increasingly common as marijuana legalization spreads.

Global spending on legal cannabis is expected to grow 230% to $32 billion in 2020 as compared to $9.5 in 2017, according to Arcview Market Research and BDS Analytics. As of June 29, 2018 the United States Marijuana Index, despite a lot of uncertainty around regulations, has over the past 1 year gained 71.49%, as compared to about 12% gain seen by the S&P 500.

Click here for your FREE Report