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No change to rating on Australian Unity Healthcare Property Trust

19 Mar 2012
From

Standard & Poor’s Fund Services today announced that there would be no change to the four-star rating on the Australian Unity Healthcare Property Trust (class A, wholesale, and retail units), following the launch of a second discount offer. 

Australian Unity Funds Management Ltd. is seeking to raise A$28.9 million for the trust, which is the shortfall from the A$50 million priority rights offer in October 2011. As originally intended, capital raised will be used for the redevelopment and expansion of three hospitals. 

Unlike the initial offer, new investors will be able to apply for discounted units in the event that existing investors do not take up their full entitlement. The second entitlement offer, again at a 7.5% discount to the fund’s unit (mid) price, closes on March 30, 2012. The subsequent allotment to new investors will be done after April 3, 2012 on a “first-in, first-served” basis, with the offer closing May 25, 2012. 

The potential for a subsequent discount offer was known to S&P and foreshadowed in our latest premium rated research report. The offer is again designed to reduce the amount required to be funded from borrowings. Importantly, it will maintain the fund’s conservative equity/debt structure. 

S&P will continue to monitor the success (or otherwise) of the discount offer, although we take comfort from the fund’s conservative capital structure and Australian Unity’s strong active-management experience.

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