VM Wealth Management helps KPREIT to raise $2 billion in rights issue

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VM Wealth Management helps KPREIT to raise $2 billion in rights issue

Wednesday, January 15, 2020

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With Victoria Mutual Wealth Management's (VMWM) assistance with corporate financing through a renounceable rights issue of its ordinary shares, Kingston Properties Limited (KPREIT) was able to raise over $2 billion to improve its ability to finance further acquisitions in Jamaica, and the wider Caribbean.

A rights issue is an invitation from a company to its owners (the shareholders) to purchase newly issued shares in that company within a specific time, while a renounceable rights issue means that shareholders can sell their rights to their allocation of shares.

According to VMWM, through the rights issue KPREIT issued 355,871,765 renounceable new shares to existing shareholders at a subscription price of $5.62, at a rate of 1.10573 new shares for every existing share held as at the record date of November 8, 2019.

The offer opened on November 18 and closed successfully on November 29, 2019, with a dollar value of over $2 billion — more than KPREIT's desired target capital.

“The environment is ripe and ready for investment, and it shows in the increase in developments across Jamaica in real estate,” said Rezworth Burchenson, VMWM chief executive officer.

“I want to thank the capital markets team for an outstanding job throughout the year, allowing us to finish on top—number one property fund in Jamaica.”

KPREIT embarked upon the rights issue to enhance its capital base, as it seeks to achieve its strategic objectives of expanding its reach. Its experience in these markets and investing in these asset subclasses will provide the optimal medium-to-long term risk adjusted-returns.

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