Assura taps into US debt market

The listed Warrington-based healthcare property investor and developer has raised £100m through agreements with Pricoa Capital Group and MetLife to issue unsecured 10-year loan notes.

The notes are at a fixed rate of 2.65% and will be used to “increase operational flexibility and reduce transaction costs associated with financing properties,” the company said.

Jonathan Murphy, finance director and interim chief executive, said: “We are very pleased to have diversified the group’s funding base through the support of two first class institutional investors. This financing is a significant next step as we continue to increase our unsecured funding base to support the business and increase operational flexibility. In addition, the funding is in line with our stated intention of achieving improved terms and pricing at the time of our equity raise in 2015. The private placement fixed coupon represents the lowest cost, long-term financing in the group’s history and further positions us for continued growth going forward.”

KPMG’s debt advisory practice, led by David Reitman, advised Assura throughout the financing process. Reitman commented: “This is a landmark transaction as it represents the first unsecured private placement in the primary care property sector. The financing also highlights the attractive funding opportunities that still abound for excellent businesses with strong credit profiles.” Assura received legal advice from Gary Grigor and Martin O’Shea at Addleshaw Goddard.

In a trading update on Monday, Assura said it completed the acquisition of 41 medical centres in the six months to the end of September for £81m with a passing rent roll of £4.9m and a weighted average unexpired lease length of 13.5 years. Assura has a further pipeline of individual asset acquisitions and developments currently in solicitors’ hands worth £114m. Assura’s portfolio has increased by more than £600m since April 2012. Assura now owns 363 medical centres with a total annualised rent roll of £70m.

Andrew Darke, property director, has joined the board of Assura. Simon Laffin, who has been executive chairman since March, will revert to his non-executive role. The search for a new chief executive continues. The previous chief executive, Graham Roberts, died from cancer in July of this year.

Shares in Assura were unchanged at 58p.