Redefine plans to buy and delist IHL
The firm wants to increase its shareholding in IHL from 17.24% to 50%, growing its exposure to income-generating hotel assets
Redefine International, the JSE-listed, income-focused UK property group, wants to take over and delist International Hotel Properties (IHL).
The firm wants to increase its shareholding in IHL from 17.24% to 50%, thereby growing its exposure to income-generating hotel assets which are gaining traction in the UK economy.
"This is an opportunistic acquisition, which increases the company’s ownership in a high-quality and high-yielding hotel portfolio to 50% and increases our exposure to the strong UK hotel market, while increasing our exposure to [leases linked to the retail price index]," said Redefine International CEO Mike Watters.
IHL is listed on the Euro MTF market of the Luxembourg Stock Exchange and on AltX.
The share price has disappointed since the 2013 listing, losing 14.5%, but it has recovered lately, climbing 2% in 2017.
Evan Robins of Old Mutual Investment Group said Redefine International needed to find more avenues to generate income. The fund had chosen to pay out a smaller percentage of its earnings base as dividends, keeping the rest for growth opportunities. The income it did pay out needed to come from more sources.
Redefine will buy 18,343,166 IHL shares from minority shareholders by way of a scheme of arrangement. If the scheme goes ahead, the listings of IHL’s shares will be terminated.