UK Mortgages Ltd - Investment Update and Share Issuance
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PR Newswire
London, June 21
THE INFORMATION IN THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION DIRECTLY OR INDIRECTLY IN OR INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA, THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF IRELAND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.
21 June 2018
UK MORTGAGES LIMITED
(a closed-ended investment company incorporated in Guernsey with registration number 60440 )
LEI 549300388LT7VTHCIT59
("UKML" or the “Company")
Investment update and intention to issue new ordinary shares
Investment update
Update on existing investments
- Malt Hill No.1 (Coventry Building Society – CBS)
- Exceptional performance – no loans currently in arrears. Only three loans previously in arrears, all cured within 1 month.
- Oat Hill No.1 (Capital Home Loans – CML)
- Performing better than expectations –just 42 loans in arrears out of 4,613 to the value of £49,737 from a pool value of £551m.
- Pool value also likely significantly higher than at purchase.
- Cornhill No.2 (The Mortgage Lender – TML)
- Portfolio growing – pipeline now approximately £190m
- Well received preparatory investor meetings at Global ABS Conference
- Just one loan in arrears
New Investments
- Malt Hill No.2 (CBS)
- Purchase of new portfolio of £350m Buy-to-Let loans announced late April and terms concluded on 1 June
- Marketing of securitisation currently in progress – roadshow completed – book-build and pricing in progress, with expected closing by end of June
- Likely IRR 6.25%-6.5%
- Keystone Property Finance (KPF)
- Termsheet signed on 19 June with KPF for an exclusive forward flow arrangement to acquire a portfolio of UK Buy-to-Let mortgages beginning in late-summer 2018.
- KPF are an existing specialist lender to portfolio landlords who have been actively originating mortgages for various third parties since 2012.
- Existing originator, so able to switch origination from existing funding provider to UKML immediately, meaning lending scale achieved from the outset: https://www.keystonepropertyfinance.co.uk.
- UKML capital can be raised and allocated incrementally as portfolio grows, minimising cash drag.
- Likely IRR in excess of 7%
Intention to issue new shares
The Board of UK Mortgages Limited (LSE: UKML) today announces its intention to issue new shares. In order to complete the new Coventry transaction and to provide initial funding for the Keystone transaction, the Company is seeking to raise additional equity capital through the issue of new ordinary shares to raise £20 million.
UK Mortgages Limited was launched on 7 July 2015 with an investment objective of providing shareholders with access to stable income returns through the application of relatively conservative levels of leverage to portfolios of UK mortgages.
The Board today announces that the Company is intending to raise additional equity capital through the issue of new ordinary shares of 1p each in the Company (the “New Shares”). The New Shares will be issued at 86.71 pence, representing a premium of 1.5% to the ex dividend unaudited net asset value (“NAV”) per share as at 30 April 2018. The Company has already received positive indications of support for the fund raise, including from members of the board and manager.
In addition to raising additional equity capital the Company is seeking to put in place a revolving credit facility as a further option for funding of future capital investments.
Following the syndication of the second Coventry portfolio and the signing of the Keystone transaction, the Manager has updated its projections as to dividend cover. This updated analysis will be made available shortly at the Company’s website: www.twentyfouram.com/funds/uk-mortgages-fund. The Board will continue to review the dividend policy in light of the modelled evolution of the Company’s yield.
How to participate
Qualified investors (as defined in section 86(7) of the Financial Services and Markets Act 2000 (as amended)) are invited to apply for New Shares by contacting Numis Securities Limited ("Numis") on the contact details below. The decision to allot New Shares to any qualified investor shall be at the absolute discretion of the Company and Numis.
Expected timetable
Fund raise opens 7am, 21 June 2018
Latest time and date for receipt of commitments 12pm, 25 June 2018
Announcement of results of Issuance 25 June 2018
Admission and dealings in New Shares on the London 8am, 27 June 2018
Stock Exchange’s Specialist Fund Market
Further information
Further information regarding the Company can be found at the Company's website https://twentyfouram.com/en/funds/uk-mortgages-fund/ or please contact:
TwentyFour Asset Management +44 (0)20 7015 8900
John Magrath
Alistair Wilson
Numis Securities Limited +44 (0)20 7260 1000
Nathan Brown
Chris Gook
Important notice
This announcement contains information that is inside information for the purposes of the Market Abuse Regulation (EU) No. 596/2014
| This Announcement has been prepared for information purposes only, it is not a prospectus. Recipients of this Announcement who are considering acquiring New Shares in the Company in connection with the Issuance 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 the Company involves a high degree of risk and prospective investors should read the section in the Prospectus entitled "Risk Factors" for further information. Any data on past performance, modelling or back-testing contained herein is no indication as to future performance and there can be no assurance that targeted or projected returns will be achieved, that the Company will achieve comparable results or that the Company will be able to implement its investment strategy or achieve its investment objectives. All opinions and estimates are given as of the date hereof and are subject to change. The value of any investment may fluctuate as a result of market changes. Ordinary Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States and the New Shares may not be offered, sold, resold, transferred or delivered, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. Persons. There will be no public offer of the New Shares in the United States. Subject to certain exceptions, the New Shares are being offered and sold only outside the United States to persons who are not U.S. Persons in reliance on the exemption from registration provided by Regulation S under the Securities Act. Moreover, the Company has not been and will not be registered under the Investment Company Act of 1940, as amended (the “Investment Company Act”) and investors will not be entitled to the benefits of the Investment Company Act. The New Shares and any beneficial interests therein may only be transferred in an offshore transaction in accordance with Regulation S (i) to a person outside the United States and not known by the transferor to be a U.S. Person, by prearrangement or otherwise; or (ii) to the Company or a subsidiary thereof. The distribution of this Announcement in certain jurisdictions may be restricted by law. No action has been taken by the Company or Numis that would permit an offering of any New Shares or possession or distribution of this Announcement or any other offering or publicity material relating to such New Shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and Numis to inform themselves about, and to observe, such restrictions. Certain statements in this Announcement are forward-looking statements which are based on the Company'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. 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, the Company 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 Company nor Numis assume any responsibility or obligation to update publicly or review any of the forward-looking statements contained herein. |
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