rights issue (3 for 1)

Taken from SMH BusinessDay 8/12/09

REIT cash thirst

INVESTORS in the embattled real estate investment trust sector will be tapped for more cash before the end of a tumultuous 2009. And this is from a sector that has already gouged close to $20 billion from shareholders since September last year.

But without the cash, there would be far fewer listed vehicles standing.

Investors are keeping a close eye on what Denis Hickey will do with his wholesale ING Retail Fund with talk that he may opt for his own float and not sell to Colonial or Lend Lease.

The Perth-based Port Bouvard, which developed canal-style projects, is the latest group to tap investors through a proposed three-for-one rights issue at 15¢, to raise about $70 million via Euroz brokers.

In November, its directors called for a suspension in trade, at about 25¢, while they negotiated with bankers at St George to roll over loans of $70 million or face asset sales.

Despite the doom and gloom, the group has completed the sales of the last canals lots at the Port Bouvard development, near Mandurah in Western Australia.