NewRiver Retail to convert to a REIT

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David Lockhart’s AIM-listed NewRiver Retail is to convert to a REIT and issue new stock to a private equity firm.

The company, which was floated last year, said to day that it was planning a REIT conversion in order to take advantage of the fact that international investors preferred shares in REITs to ordinary listed property companies.

“The board considers that conversion will make the company more attractive to UK and international real estate investors and should improve the company’s access to additional capital,” the company said.

In addition, it will issue £25m of convertible loan stock with a 5.85% coupon, with £15m of this to be taken up by a fund managed by Forum partners Investment Management.

It has also completed the acquisition of a portfolio of five retail properties from Standard Life for £14m.

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