Symphony International has launched a fully underwritten USD100m rights issue.
The proceeds will allow Symphony to invest in additional opportunities that its investment manager is exploring in the healthcare, hospitality and leisure sectors (including branded real estate developments) in the Asia Pacific region.
The company believes there are a number of other potential benefits to shareholders by issuing further shares and increasing its available capital, including:
• Providing additional capital will enable the company to benefit from the continued investment opportunities in the market;
• Having a greater number of shares in issue which may provide the shares with additional liquidity;
• Increasing the size of the company which will help make it more attractive to a wider shareholder base;
• The company’s fixed running costs will be spread across a wider shareholder base, thereby reducing the total expense ratio.
Panmure Gordon (UK) is acting as sole underwriter, financial adviser and broker to the company.
The 0.481 for 1 rights issue is to be priced at USD0.60 per new ordinary share representing a discount to the closing share price on 3 October 2012 of 9.94 per cent.
The excess application facility allows qualifying shareholders to apply for excess shares, in addition to their rights issue entitlements under the rights issue, up to a maximum of 0.481 new shares for one existing share.
Symphony’s current market capitalisation on 2 October 2012 was USD234.8m (based on its closing price on the same date).
Symphony’s NAV as at 30 June 2012 was approximately USD430.1m and was approximately USD472.5m as at 2 October 2012 (the latest practicable date before this announcement).
Symphony’s directors intend to subscribe for 16,027,465 new shares and have given sub-underwriting commitments in respect of an additional 14,641,150 new shares. This is an aggregate commitment of approximately USD18.4m to the rights issue.
If after five years, the company’s shares continue to trade at a greater than 35 per cent discount to NAV per share and the directors reasonably consider that if the investments of the company were sold for cash through an orderly sale process, the net proceeds of that process would be at least 80 per cent of the NAV at that time, the directors intend to propose a resolution to shareholders to liquidate sufficient assets so as to enable the distribution in cash to shareholders of an aggregate amount of at least 80 per cent of the NAV at that time.
At the company’s AGM in 2013, the directors of Symphony intend to propose a special resolution to amend the company’s articles of association to prevent the issuance of shares by the company at a price which represents a discount of more than 15 per cent to the then most recently published NAV per share (except where approved by the shareholders).
