360 Capital Group have agreed to acquire a listed investment vehicle and management company in an $80M deal.
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As part of the deal 360 Capital FM Limited as responsible entity for 360 Capital Total Return Active Fund and 360 Capital Total Return Passive Fund (ASX: TOT) propose to acquire 100% of the issued capital of URB whilst TGP will pay Contact Asset Management Pty Limited $2.5 million for the management rights of the Trust.
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The deal will boost 360 Capital’s market capitalisation to about $170m and lifts its gross assets to about $178m and increases TOT’s investor base to over 3,500 investors.
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URB is a Listed Investment Company, established in October 2016 which aims to maximise total Shareholder returns through a combination of capital and income growth generated by an Investment Portfolio that is focused upon urban renewal and regeneration. It invests in direct property and equities.
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in the year to June 2019, Net assets of the Company grew from $78.4m to $87.5m, including an Equity Portfolio valued at $45.3m, a Direct Property portfolio valued at $11.5m and Cash and Dividends receivable of $29.8m.
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Total Shareholder Return for the year to 30 June 2019 was 20.1%.
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The deal between TOT and URB will be undertaken by a scheme of arrangement and will be voted on at a December meeting. URB’s board intends to unanimously recommend shareholders vote for the scheme, in the absence of a superior proposal and subject to an independent expert report.
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URB shareholders will receive 0.9833 360 Total Return units for each share they hold. Based on the price of $1.18, the implied value of the scheme is about $1.16 per URB share, incorporating a 3 per cent premium to the URB adjusted pre-tax NTA per share of $1.136.
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The implied value of the Scheme Consideration represents the following premiums to relevant URB Share price benchmarks: 13.2% premium to URB’s closing price prior to the date of this announcement;
- 12.3% premium to URB's 30-day VWAP;
- 7.2% premium to URB's 3-month VWAP; and
- 29.6% premium to URB's trading price of $0.895 on 24 May 2019 (being the date prior to TOT commencing to buy URB Shares).