ERES REIT Announces Pricing and Terms of C$145 Million Public Offering
/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES/
TORONTO, Sept. 17, 2019 /CNW/ - European Residential Real Estate Investment Trust (TSX-V:ERE.UN, "ERES" or the "REIT") announced today that it has priced its previously announced public offering (the "Offering") of trust units of the REIT (the "Units"), and that the REIT has entered into an underwriting agreement with a syndicate of underwriters led by RBC Capital Markets and Scotiabank (collectively, the "Underwriters") to sell 34,945,000 Units at a price of C$4.15 per Unit (the "Offering Price"), subject to the approval of the TSX Venture Exchange (the "TSX-V"), for aggregate gross proceeds of approximately C$145 million. The Offering is expected to close on or about September 24, 2019, subject to satisfaction of customary closing conditions, including the listing of the Units sold pursuant to the Offering on the TSX-V.
The REIT has also granted the Underwriters an over-allotment option exercisable in whole or in part at any time up to 30 days from the closing of the Offering to purchase up to 5,240,000 additional Units (the "Over-Allotment Option").
As a part of the Offering, CAPREIT has agreed to purchase 4,820,000 Units at the Offering Price representing gross proceeds of approximately C$20 million. CAPREIT's current 89% effective interest in ERES will decrease to 76% upon completion of the Offering and completion of the previously announced portfolio acquisitions described in ERES' September 16, 2019 press release (collectively referred to as the "Acquisitions"). Assuming the Over-Allotment Option is exercised in full, CAPREIT's ownership would further decrease to 74%.
ERES intends to use the net proceeds from the Offering to partially finance the Acquisitions, and to partially repay the approximately €22.5 million outstanding balance on ERES' existing credit facility. If the Over-Allotment Option is exercised, the net proceeds will be used to repay indebtedness, fund future acquisitions, and for general trust purposes.
ERES has filed a preliminary prospectus supplement, and will file a final prospectus supplement (the "Prospectus Supplement") to its short form base shelf prospectus dated August 19, 2019 (the "Base Shelf Prospectus") with the securities regulatory authorities in each of the provinces and territories of Canada. A copy of the Prospectus Supplement, following filing thereof, and accompanying Base Shelf Prospectus may be obtained on SEDAR at www.sedar.com. The Base Shelf Prospectus contains, and the Prospectus Supplement will contain, important detailed information about ERES and the Offering. Prospective investors should read the Prospectus Supplement and accompanying Base Shelf Prospectus and the other documents incorporated by reference therein before making an investment decision.
This press release shall not constitute an offer to sell, or the solicitation of an offer to buy, any securities of ERES in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities being offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States or to U.S. persons absent registration or pursuant to applicable exemption from registration.
ABOUT ERES
ERES is an unincorporated, open-ended real estate investment trust. ERES' Units are listed on the TSX-V under the symbol ERE.UN. ERES is Canada's only European-focused multi-residential REIT, with an initial focus on investing in high-quality multi-residential real estate properties in the Netherlands. ERES currently owns a portfolio of 88 multi-residential properties, comprised of 3,859 suites located in the Netherlands, and owns two office properties in Germany and one office property in Belgium.
ERES's registered and principal business office is located at 11 Church Street, Suite 401, Toronto, Ontario M5E 1W1.
For more information, please visit our website at www.eresreit.com.
ABOUT CAPREIT
As one of Canada's largest residential landlords, CAPREIT is a growth-oriented investment trust managing 62,645 suites and sites across Canada, the Netherlands and Ireland. It owns 59,023 residential units, comprising of 47,346 residential suites and 72 manufactured home communities comprising 11,677 land leases sites located in and near major urban centres across Canada and The Netherlands. For more information about CAPREIT, its business and its investment highlights, please refer to our website at www.caprent.com or www.capreit.net and our public disclosure which can be found under our profile at www.sedar.com.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this press release constitute forward-looking statements within the meaning of applicable Canadian securities laws which reflect ERES' current expectations and projections about future results. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "expect", "intent", "estimate", "anticipate", "believe", "consider", "should", "plans", "predict", "estimate", "forward", "potential", "could", "likely", "approximately", "scheduled", "forecast", "variation" or "continue", or similar expressions suggesting future outcomes or events. The forward-looking statements made in this press release relate only to events or information as of the date on which the statements are made in this press release. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this press release. Such forward-looking statements are based on a number of assumptions that may prove to be incorrect.
Except as specifically required by applicable Canadian securities law, ERES does not undertake any obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. These forward-looking statements should not be relied upon as representing ERES's views as of any date subsequent to the date of this press release. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
Completion of the Acquisitions and the Offering is subject to a number of conditions, including but not limited to, acceptance by TSX Venture Exchange Inc. There can be no assurance that the Acquisitions or the Offering will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the Prospectus Supplement or the Base Shelf Prospectus, any information released or received with respect to the Acquisitions or the Offering may not be accurate or complete and should not be relied upon.
Neither the TSX-V nor its Regulation Services Provider (as that term is defined in the policies of the TSX-V) have in no way passed upon the merits of the Acquisitions or the Offering and have neither approved nor disapproved the contents of this news release.
SOURCE European Residential Real Estate Investment Trust
ERES, Mr. Phillip Burns, Chief Executive Officer, (416) 354-0167, [email protected]; ERES, Mr. Scott Cryer, Chief Financial Officer, (416) 861-5771, [email protected]; CAPREIT, Mr. Mark Kenney, President & CEO, (416) 861-9404, [email protected]
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