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A couple of announcements from British Land

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idpickering
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A couple of announcements from British Land

#145638

Postby idpickering » June 14th, 2018, 4:49 pm

British Land and GIC complete the sale of 100% of 5 Broadgate to CK Asset Holdings for £1bn

British Land and GIC are pleased to announce that they have completed on the sale of 100% of 5 Broadgate to a wholly-owned indirect subsidiary of CK Asset Holdings Limited for £1 billion, which is in line with 31 March 2018 valuation.


https://www.investegate.co.uk/british-l ... 57393937R/

British Land announce further share buyback programme


Following the sale of 5 Broadgate announced this morning, British Land intends to extend its share buyback programme by allocating up to £200 million to purchase shares in the Company during the current financial year.


https://www.investegate.co.uk/british-l ... 57413928R/

idpickering
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Re: A couple of announcements from British Land

#145743

Postby idpickering » June 15th, 2018, 8:47 am

Further to the buy back, they put this out today;

Engagement of brokers to execute share buyback programme

The British Land Company PLC ("the Company") announces that it has engaged Morgan Stanley and UBS ("the Brokers") in relation to the programme, announced on 14 June 2018, to repurchase the Company's ordinary shares up to the value of £200 million. The programme will be executed between 15 June 2018 and 31 March 2019.The purpose of the programme is to reduce the capital of the Company.

The Brokers will purchase the Company's ordinary shares as principal and sell them on to the Company in accordance with the terms of their respective engagements. The Company intends to cancel the shares it purchases through the programme.


https://www.investegate.co.uk/british-l ... 00024799R/

Dod101
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Re: A couple of announcements from British Land

#145753

Postby Dod101 » June 15th, 2018, 9:47 am

This is not a great endorsement for the London property market surely? The £200 million is not a huge amount of money but still, they are deliberately reducing the size of the Company.

Dod

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Re: A couple of announcements from British Land

#145770

Postby blobby » June 15th, 2018, 10:31 am

This looks like good business to me. British Land has a market cap of £6.8 billion so a £1 billion sale is significant. As the sale is at book value it should not affect profit, but it may increase the value of the rest of the development that they are still working on.

As net tangible asset value is 941p and the share price is only 690p, purchasing £0.2 billion of the company’s own shares is an obvious way of delivering more value for shareholders although this may not be that significant in percentage terms.

Dod101
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Re: A couple of announcements from British Land

#145782

Postby Dod101 » June 15th, 2018, 10:54 am

Thanks Blobby.
British Land is a small holding for me so I do not follow it very closely. It sounds as if buying the shares at the current price is fine but it is just a shame that they cannot make better use of the funds from an asset sale. They are in effect reducing the size of the company.

Dod

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Re: A couple of announcements from British Land

#145826

Postby idpickering » June 15th, 2018, 12:42 pm

I've held British Land as my REIT of choice since 19 Mar 2010, and have topped up 3 times since. In capital value terms they account for 2.9% of my 32 share HYP. For me they are exactly what I'm looking for in a HYP holding in that it's boring, there's no surprises, and it pays a decent divi/yield. I have no intention of topping up currently, and am not selling out either.

Ian.

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Re: A couple of announcements from British Land

#146117

Postby Arborbridge » June 16th, 2018, 3:44 pm

Instead of employing very expensive brokers to buy back shares, why not just pay me a higher dividend? Why would I want to pay brokers for achieving next to nothing with my company's cash - and I doubt their fees are next to nothing.

Arb.

Dod101
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Re: A couple of announcements from British Land

#146127

Postby Dod101 » June 16th, 2018, 4:25 pm

They obviously want to reduce the number of shares in issue. In the recent Annual Report they also mentioned that following the sale of the Leadenhall Building, they had conducted a share buyback of £300 million to try to counter the discount to NAV at which the share were trading. They also said then that this would remain a focus for them and it seems this latest buyback is just a continuation of that policy. Shrinking the size of the Company though but maybe good for the share price.

Dod

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Re: A couple of announcements from British Land

#146131

Postby monabri » June 16th, 2018, 4:30 pm

Arborbridge wrote:Instead of employing very expensive brokers to buy back shares, why not just pay me a higher dividend? Why would I want to pay brokers for achieving next to nothing with my company's cash - and I doubt their fees are next to nothing.

Arb.


Agreed - I'd prefer a special divi.

Current yld of 4.3% versus CTY of 4.05%.

BLND's dividend compound annual growth rate over 5, 10 and 15 years is 2.64%, 0.37% and 6.87%.
CTY .............4.22%, 4.48% and 5.34%.

Is there a case to be made to "derisk".....the management team seem keen to give money away to brokers and not to shareholders.

Dod101
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Re: A couple of announcements from British Land

#146140

Postby Dod101 » June 16th, 2018, 5:17 pm

Whilst we all like dividends and funnily enough I do not really much like B Land, I have a lot of sympathy for the management because buying their shares at a discount to NAV makes sense, and reduces the mouths to feed for the dividend.

The current yield is very acceptable.

Dod


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