Dundee International Real Estate Trust Said to Raise C$410 Million in IPO
Dundee International Real Estate Investment Trust raised C$410 million ($433 million) in an initial public offering, 12 percent more than it originally sought, said three people with knowledge of the sale.
The Toronto-based REIT sold 27 million units at C$10 each, as well as C$140 million in convertible debentures with a 5.5 percent coupon, said the people, who asked not to be named because the terms aren’t public. Dundee International initially sought to raise C$365 million, the people said, and increased the amount because of investor demand. Proceeds will be used to buy properties in Germany, according to a regulatory filing.
Dundee International was one of three Canadian REITs that raised at least C$725 million this week. TransGlobe Apartment REIT sold C$225 million of units and debentures in a secondary offering and Allied Properties REIT raised C$90 million in its sale. CIBC led the TransGlobe deal and Scotia Capital led the Allied sale, which were both completed yesterday.
Dundee International’s offering is the largest REIT IPO in Canada in at least a decade, surpassing TransGlobe’s C$247.3 million IPO in May 2010. TD Securities led a group of 11 firms, and the banks have an option to buy another 15 percent of shares. The units will start trading Aug. 3 on the Toronto Stock Exchange.
The REIT was founded by Dundee Corp. (DC/A)’s real estate unit to buy 295 office and other commercial properties in Germany with about 12.5 million square feet (1.2 million square meters) of leasable commercial area, according to a June 8 filing. Deutsche Post AG (DPW), Europe’s largest mail carrier, leases about 75 percent of the property, which would make Dundee International REIT the largest landlord in Germany for the postal company, according to the filing.
Dundee Corp., a Toronto-based firm that offers asset management and real estate services, will buy 10 million units and its Dundee Realty Corp. unit will buy 2 million units, the filing said. Dundee Realty, which formed Dundee REIT in 2003, has about C$5 billion in assets under management.
A telephone message left for Dundee Corp. Chief Executive Officer Ned Goodman wasn’t immediately returned.
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