management team we sat down with our corporate
advisory team and weighed up the options of listing by
way of private placement or public offer.”
A private placement differs from a public offer in that the
former is effectively by invitation and the second is open
to any qualifying investor. Delta decided on the private
placement option as it was confident that enough appetite
existed from major institutional investors. “Compiling
a pre-listing statement – a 170 page document – setting
out the history and motivation for the listing took some
doing, especially given our tight deadlines,” comments
Corbett. “In addition, external independent assurances on
property valuations and the financial accounts had to be
obtained – BDO and Active Blue Value Solutions assisted
us tremendously. Nedbank Corporate then arranged for
us to road show our investment case to South Africa’s
major property investors such as the Public Investment
Corporation, Coronation, Investec, Stanlib, Momentum,
Sanlam, Liberty and Eskom’s pension and provident fund.
This included site visits at the various assets in order for
potential linked unitholders to familiarise themselves with
the portfolio.”
“In light of our decision to list by way of private
placement, liquidity was an important consideration.
Linked unitholders want to know that they can easily
buy and sell their units in a listed company,” Nomvete
continues. “Nedbank Private Wealth offered fantastic
access to high-net worth individuals who were interested
in our listing story. Their support would ensure continuous
trades in Delta units, stimulating liquidity.” In addition to
meeting with potential investors and obtaining the various
regulatory approvals, Delta embarked on a considered
media campaign to raise further awareness of the fund.
“This all finally culminated in our listing on 2
November last year, when we raised R980 million in an
oversubscribed private placement,” smiles Nomvete.
“The fact that we’re listed provides us with a number
of options to deliver on the high-growth mandate from
www.reimag.co.za
linked unitholders,” comments Corbett. Earlier this year
Delta successfully raised R1 billion in an oversubscribed
rights offer to fund a portion of further acquisitions that
will see the portfolio expand to R4.3 billion in value.
“Access to debt funding was further augmented with
the introduction of facilities from Standard Bank South
Africa in addition to funding lines from Nedbank
Capital,” she adds. At the end of July, Delta announced
that it successfully entered the debt capital markets with
the completion of its debut commercial paper issuance.
The notes were issued off Delta’s newly established R2
billion Domestic Medium Term Note Programme that
is registered with the JSE. DLTC01 – which is Delta’s
inaugural issuance – is a R190 million, six-month
unsecured note with a fixed interest rate of 6.19% per
annum. Global Credit Ratings Co. assigned Delta a
national scale A2 short-term credit rating. “Since our
listing late last year, Delta has maintained its growth
trajectory. It therefore makes sense for us to diversify
our funding sources further by accessing the debt
capital market. This provides us with various funding
options and leverage when negotiating on acquisitions,”
remarked Nomvete.
Added Corbett: “We are very encouraged by the strong
support for the initial issuance which was underpinned by
a solid credit rating by Global Credit Ratings Co.”
TO