Irish property group Cairn Homes said on Tuesday that it had successfully placed 33.7 million new ordinary shares with institutional investors, raising €51.9 million in gross proceeds.
The shares were placed by Goodbody, Bank of America Merrill Lynch and Davy at a price of €1.54 each. Cairn's stock had closed in London at €1.58 on Monday.
The new shares represent about 4.9 per cent of Cairn’s existing issued ordinary share capital prior to the placing.
Cairn is expected to use the funds to help bid for a number of prime development sites in Dublin, including land being sold by broadcaster RTÉ at its Donnybrook complex.
In March, RTÉ announced plans to sell 8.64 acres of land at Montrose with Savills guiding €75 million for the site. A number of leading property developers are expect to bid for this prime residential site.
War chest
To further boost its war chest for purchases, Cairn is expected to enhance senior credit facilities with its bankers, and is also reported to be selling some of its smaller residential sites as a job lot for about €30 million.
Applications have been made for the new shares to be admitted for trading on the London Stock Exchange on May 18th.
Commenting on the placing, Cairn's co-founder and chief executive Michael Stanley said: "We are delighted to have successfully completed this placing with the very strong support received from our shareholders. The funds raised will further strengthen our balance sheet and enable us to continue to review and refine the company's land bank and where appropriate acquire further attractive and well located residential development sites."
Current trading
On Monday, Cairn also gave an update on current trading after European markets closed. The company achieved net revenues of €23.5 million from January 1st to May 12th and expects to achieve its sales target for 2017 of between 375 and 400 new units.
It will undertake an “off-plan” launch of the first phase of its 1,095-unit Shackleton Park development in Lucan, Co Dublin, later this week. And it intends to release an additional 40 units at its upmarket Marianella apartment development in Rathgar this month, to bring the total number of sale-agreed units there to more than 100.
