Italy's IGD Siiq buys €92m retail package

Italian REIT IGD Siiq has bought a core portfolio of five retail assets from supermarket groups Coop Adriatica and Unicoop Tirreno for €93 mln.

The portfolio includes the Città delle Stelle shopping centre in Ascoli Piceno and two hypermarkets owned by Coop Adriatica in Schio and Cesena Lungo Savio as well as two supermarkets owned by Unicoop Tirreno, the company’s controlling shareholders, in Cecina and Civita Castellana.

The acquired assets will be leased back by the Coops under an 18-year lease agreement.

To finance the acquisition, IGD is planning to carry out a capital increase of up to €200 mln, through a rights issue offered to all its shareholders. Coop Adriatica and Unicoop Tirreno have already committed to subscribe to their portion of the capital increase; BNP Paribas has agreed to subscribe to the unexercised portion (if any) of the share capital increase.

The purchase is conditional upon approval of the capital increase at the company's next shareholder meeting.

IGD said it expects its funds from operations (FFO) to increase by approximately €10 mln following the deal while the capital increase is forecast to decrease the group's cost of debt and bring loan to value ratio below 50%.

Claudio Albertini, CEO of IGD, said that 'the purchase is in line with IGD’s real estate strategy which, from the beginning, has been based on the industrial, strategic and commercial partnership with the Coops'.

'With regard to the capital increase, this step confirms the continuous commitment of the shareholders to the company and, moreover, is taking place at a time when capital markets are particularly favorable thanks to the significant inflows of liquidity in the market, along with historic low yields and the renewed international investors’ interest in Southern Europe, in general, and Italy in particular,' added Albertini.

BNP Paribas acted as the financial advisor and sole global coordinator, while Chiomenti Studio Legale acted as legal advisor.