PHP raises £100m to develop health centres
UK-listed Primary Health Properties has raised £100m (€113m) in additional equity to bankroll the development of new health centres, including four properties in Ireland that will require a capital commitment of €55m.
Primary Health Properties (PHP) is already a major investor in healthcare centres in Ireland, with 15 properties valued at €174m. Earlier this year, it said it will have spent €300m here by 2021.
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PHP merged in March with MedicX, creating a group with 484 properties valued at £2.3bn.
The firm told investors, as it launched its accelerated book-build for its fresh funding, that it had seen an increased number of opportunities for funding new developments in Ireland and the UK.
"The directors believe these transactions to be very attractive for PHP as they typically involve the development of larger medical centres that house bigger GP practices, providing a more integrated healthcare offering in line with PHP's stated strategy of focusing on hub primary care centres," it said.
The new equity will also be used to fund the £20m development of four sites in the UK.
PHP said the funding and acquisition of new medical centres mean it must commit to making capital available during the course of the developments, typically for a period of between 12 and 18 months.
"If funded by equity, these developments as they complete will increase the value of unfettered assets in the PHP portfolio and strengthen its balance sheet," it added.
PHP said it planned to raise £75m, with the right to increase the placing to £100m depending on investor demand. Yesterday afternoon, it confirmed that it had raised £100m.
"The company has a strong pipeline of opportunities that it is pursuing that, together with the improved terms we recently secured in the debt markets and a proportionately reducing cost base, will enhance earnings and enable dividend cover to be maintained," said managing director Harry Hyman.