Posted: 2006-04-05 23:57 Corovest lists fund on AIM  Presenter: Lindsay Williams Guest(s): Gavin Tipper Corovest International - UK arm of SA-based Coronation Investments and Trading - will shortly list property fund CIREF plc on the Alternative Investment Market (AIM) of the London Stock Exchange (LSE). With Coronation non-executive chairman Gavin Tipper LINDSAY WILLIAMS: Gavin, I understand you had the opportunity of a main board LSE listing if that’s the correct phrase, but you chose AIM - why was that? GAVIN TIPPER: We chose AIM simply given the size of the property fund, and the stage of its development - a main board listing in London is expensive, and in our view it’s more appropriate for bigger organizations - this thing is still relatively small. LINDSAY WILLIAMS: When you say relatively small – what’s its size at the moment? GAVIN TIPPER: It has got 160-million pounds in assets under management - we hope to raise a further 35-million pounds which would give rise to a significantly enhanced level of assets under management, giving gearing and so on - but really is still well below 1-billion pounds. LINDSAY WILLIAMS: So one of the reasons for listing is to raise a bit of cash because you’ve got your eye on a few assets - can you speak about those assets? GAVIN TIPPER: Absolutely, but not in specific detail other than to say in the portfolio there are a couple of significant development opportunities where we own shopping centres, or shares in shopping centres - and would seek to re-develop them very significantly, which will consume large amounts of money. An example is the centre of Newport - we are the primary developer to rejuvenate that centre in a 200-million pound development ahead of the Ryder Cup in 2010. We have a series of other investment opportunities identified that would consume 25% or so of the listing’s proceeds, and we would keep back about 30% for future opportunities. LINDSAY WILLIAMS: Is it fair to say that the bulk of your current portfolio of R1.6-billion or 160-million pounds is in the retail field? GAVIN TIPPER: About 60% is in retail, yes. LINDSAY WILLIAMS: Liberty International - if you look at that share price, and the results - it’s doing extremely well in that sort of area, are you looking for the same sort of growth in terms of your share price? GAVIN TIPPER: We would love the same growth in terms of our share price, but we are a lot smaller than they are. LINDSAY WILLIAMS: The state of the market in the UK at the moment - you’re upgrading the facility you spoke about at Newport in Wales, but that is an event-specific development - in general you finding there are still opportunities? GAVIN TIPPER: There are opportunities - the UK property market is tough at the moment, yields I think are at all-time lows - hence we are finding it quite difficult to buy the right properties. We tend to be quite picky - if properties don’t meet our criteria we don’t buy them. Having said that - given the portfolio that we’ve got - there’s significant optionality in that portfolio. We have identified a series of further opportunities, which as I said a bit earlier we will purchase using some of the proceeds of this listing, and we’re starting to look at properties in Europe. LINDSAY WILLIAMS: Any specific countries? GAVIN TIPPER: We bought two properties in Switzerland, and we’re currently looking at a couple in Germany. LINDSAY WILLIAMS: Who is managing this for you? GAVIN TIPPER: Corovest International’s Mike Watters has significant property experience… LINDSAY WILLIAMS: The critical mass - what sort of assets are you looking for? GAVIN TIPPER: We would ultimately target about 750-million pounds in assets under management over a five-year period, but clearly one must see where we get to in the next few years. LINDSAY WILLIAMS: In terms of investors for the listing on AIM - the split between South African investors and international investors? GAVIN TIPPER: About 30% South African, another 30% of existing investors, and the balance UK investors… LINDSAY WILLIAMS: The reaction so far? GAVIN TIPPER: Very positive. We did a South African road show two or three weeks ago, and my impression is it really went down quite well. LINDSAY WILLIAMS: I notice in your notes here that you may be looking in the next three to five years at a secondary listing on the JSE - why would that be necessary? GAVIN TIPPER: Simply to make it easier for our South African investors to trade in the shares - traditionally we’ve had a significant level of South African investment into this fund prior to the listing. We believe that many of those investors will stay with the fund, and we may attract a number of new South African investors - clearly a secondary listing on the JSE simply makes it easier for them to buy and sell the shares. Comments Related to this transcript: Comment on this transcript... Name : Email : Comments :