Residential Secure Income Finalizes Retirement Disposal, Initiates Distribution of Living REIT Shares to Shareholders

Details of LIVE Share Admission and Distribution Schedule

Following the fulfillment of conditions for the Retirement Disposal announced on 15 July 2026, RESI confirmed that 66,103,233 ordinary shares of Living REIT plc were allotted and issued to ReSI Portfolio Holdings Limited on 16 July 2026. These shares were admitted to the closed-ended funds segment of the Official List and commenced trading on the London Stock Exchange Main Market at 8:00 a.m. on the same day, marking a key milestone in RESI’s portfolio restructuring.

The in-specie distribution of LIVE shares to RESI shareholders will proceed according to a set timetable. The ex-date for the distribution is 21 July 2026, with the record date set at 6:00 p.m. on 22 July 2026. Shareholders on the register at this time will receive their allocation of LIVE shares on 23 July 2026. The exchange ratio is approximately 0.3570 LIVE shares for each A30.01 RESI share held. Fractional entitlements will be rounded down to the nearest whole share to ensure a streamlined distribution process.

Valuation and Structure of Retirement Disposal Consideration

The LIVE shares distributed represent approximately A362.3 million in total consideration, based on the issue price of 94.23 pence per share, which corresponds to the EPRA Net Tangible Assets (NTA) per share as of 31 December 2025. This valuation offers shareholders a transparent understanding of the value of shares received. The share consideration constitutes the primary portion of the total transaction value, reflecting the market value of Living REIT plc’s net tangible assets at year-end.

In addition to share consideration, the Retirement Disposal generated A345.0 million in cash proceeds. This cash component is a significant part of the overall transaction value and was received by ReSI Portfolio Holdings Limited upon completion. The board has chosen to return this cash to shareholders through a structured B Share redemption scheme rather than an immediate capital distribution.

B Share Redemption Scheme for Cash Distribution

The A345.0 million cash proceeds will be returned to RESI shareholders via a bonus issue of redeemable B shares, which will then be immediately redeemed by the company. These B shares are unlisted, redeemable, fixed-rate preference shares with a nominal value of one penny each. Redemption will involve a cash payment equal to the amount treated as paid up on the B shares’ issue, providing a compliant mechanism to distribute cash proceeds.

The RESI board expects to complete the initial capital return under the B Share Scheme during Q3 2026. Before finalizing the amount to be distributed, the board will assess the cash required to cover outstanding obligations, including estimated transaction costs and contingent liabilities of A33.9 million related to the Retirement Disposal and other portfolio disposals, working capital needs through the Managed Wind-Down, Property Income Distribution obligations to maintain UK REIT compliance, and costs associated with the company’s orderly exit from the REIT regime, including REIT financial statements and HMRC filings.

Deferred Consideration and Ongoing Matters

The announcement notes that deferred consideration of up to A31.0 million in newly issued LIVE shares may become payable concerning the Retirement Disposal. This contingent amount reflects typical disposal arrangements where final consideration depends on post-completion conditions or adjustments. RESI has confirmed that further updates on the B Share Scheme implementation and deferred consideration payments will be provided as developments occur.

Shareholders should be aware that all timetable dates are indicative and may be subject to change. Should any adjustments be necessary, RESI will notify the Financial Conduct Authority and shareholders via a Regulatory Information Service, ensuring transparency and flexibility in managing completion logistics.

Residential Secure Income’s Strategic Business Model and Context

Residential Secure Income plc operates as a UK-focused real estate investment trust specializing in the residential sector. The Retirement Disposal is a key element of the company’s portfolio restructuring strategy within its Managed Wind-Down programme, representing a phased and deliberate exit rather than a reactive market move. The completion of the Retirement Disposal and the establishment of Living REIT plc as a separately listed entity reflect RESI’s decision to isolate its retirement housing portfolio into an independently managed investment vehicle.

This transaction structure underscores RESI’s commitment to shareholder value while maintaining compliance with the UK REIT regime during the transition. By distributing Living REIT shares in specie instead of cash, shareholders gain direct exposure to the retirement housing assets without triggering immediate tax liabilities. Maintaining REIT status during wind-down requires careful management of cash distributions and asset use, as detailed in the B Share scheme timing and quantum provisions.

Managed Wind-Down Programme and Regulatory Compliance

The Retirement Disposal is part of RESI’s broader Managed Wind-Down programme, which mandates ongoing compliance with UK REIT regime conditions throughout the exit process. This includes meeting Property Income Distribution requirements for each financial year in which disposals occur, ensuring the company satisfies HMRC’s qualifying income thresholds. The orderly exit strategy safeguards shareholders’ tax status while enabling systematic portfolio realization and capital returns.

The company must retain sufficient cash reserves to cover various obligations, including estimated A33.9 million in transaction costs and contingent liabilities from the Retirement Disposal alone. Additional expenses relate to preparing REIT financial statements and HMRC filings through the wind-down’s conclusion, impacting the timing and amount of shareholder distributions.

Market Implications of Living REIT plc’s Separate Listing

The admission of Living REIT plc shares to the London Stock Exchange Main Market creates a dedicated investment vehicle focused on retirement housing assets, a niche within the UK residential real estate market. This sector has attracted specialized investment due to demographic trends and growing demand for retirement accommodation. Separating the retirement portfolio into a standalone listed entity offers investors targeted exposure through a focused management structure and investment mandate.

Living REIT shares were valued at 94.23 pence per share on admission, based on the EPRA NTA as of 31 December 2025, providing a transparent market entry price for the new entity. This facilitates clear pricing for shares distributed to RESI shareholders and enables investors to monitor the retirement housing segment separately from broader residential real estate trends affecting RESI’s remaining assets.

Capital Management Strategy and Shareholder Updates

The board’s decision to defer B Share redemption timing and amount until assessing appropriate cash retention reflects prudent capital management during a complex disposal programme. This approach minimizes the risk of distributing capital needed to cover unforeseen liabilities or working capital during the wind-down, protecting both the company and shareholders.

The announcement outlines the cost categories influencing capital retention decisions, including the A33.9 million provision for transaction and contingent liabilities, working capital needs, and REIT compliance expenses. Investors should anticipate further updates on the B Share redemption quantum as the board completes its obligations review and determines available cash for distribution.

Completion Timeline and Investor Guidance

The Retirement Disposal’s completion on 16 July 2026 and the planned LIVE share distribution on 23 July 2026 mark important steps in RESI’s capital return programme. The ex-date and record date provide clear deadlines for shareholder entitlements. The board’s expectation of an initial B Share redemption in Q3 2026 indicates that cash distributions will begin within a defined timeframe, subject to final assessments.

Investors should monitor forthcoming regulatory filings and announcements for details on B Share redemption amounts, timing, and any adjustments to the wind-down schedule. The potential A31.0 million deferred consideration payable in LIVE shares adds an element to watch, as payment depends on post-completion conditions. Given the complexity of managing a multi-stage disposal while maintaining REIT compliance, shareholders are encouraged to review disclosed cost estimates and capital retention policies carefully.