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TORONTO, July 8, 2016 /CNW/ – H&R Real Estate Investment Trust (“H&R REIT” or the “REIT”) and H&R Finance Trust (collectively, “H&R”) (TSX: HR.UN; HR.DB.D; HR.DB.E and HR.DB.H) today announced receipt of final acceptance from the Toronto Stock Exchange (“TSX”) of H&R’s notice of intention to make a normal course issuer bid (“NCIB”). Under the NCIB, H&R REIT will have the ability to purchase for cancellation up to a maximum of 5,000,000 Stapled Units on the open market. As at June 30, 2016, H&R had 282,413,855 outstanding Stapled Units.
The NCIB will commence on July 14, 2016 and remain in effect until the earlier of July 13, 2017 and the date on which H&R REIT has purchased the maximum number of Stapled Units permitted under the NCIB. Purchases of Stapled Units under the NCIB will be made in accordance with TSX by-laws, rules and policies through the facilities of the TSX, and through alternative trading systems. The Stapled Units so purchased will be cancelled. The price paid for any repurchased units will be the market price of such Stapled Units at the time of acquisition. Daily purchases will be limited to 138,648 Stapled Units other than block purchase exemptions.
H&R believes that its outstanding Stapled Units represent an attractive investment, and the ongoing purchase of its outstanding Stapled Units may benefit all persons who continue to hold Stapled Units by increasing their equity interest in H&R.
H&R intends to establish an automatic purchase plan under which its broker may purchase Stapled Units according to a prearranged set of criteria. The plan will enable the purchase of Stapled Units at any time, including when H&R would not ordinarily be active in the market because of internal trading blackout periods, insider trading rules or otherwise. The plan will terminate on the earliest of: the date on which the purchase limits specified in the plan have been attained, the date on which the normal course issuer bid terminates or the date on which the plan is terminated by a party in accordance with its terms. To H&R’s knowledge, after reasonable inquiry, none of the directors, officers or other insiders of H&R or any associate of any such persons, or any associate or affiliate of H&R currently intends to sell Stapled Units to H&R during the course of the issuer bid.
H&R has made purchases of Stapled Units under a normal course issuer bid through the facilities of the TSX which was approved by the TSX on June 4, 2015 and expired June 8, 2016. Under that bid, H&R purchased and cancelled 141,800 Stapled Units at a weighted average price of $19.28 per Stapled Unit.
About H&R REIT and H&R Finance Trust
H&R REIT is Canada’s largest diversified real estate investment trust with total assets of approximately $14.6 billion as at March 31, 2016. H&R REIT is a fully internalized real estate investment trust and has ownership interests in a North American portfolio of high quality office, retail, industrial and residential properties comprising over 47 million square feet.
H&R Finance Trust is an unincorporated investment trust, which primarily invests in notes issued by a U.S. corporation which is a subsidiary of H&R REIT. The current note receivable balance is U.S. $220.4 million. In 2008, H&R REIT completed an internal reorganization which resulted in each issued and outstanding H&R REIT unit trading together with a unit of H&R Finance Trust as a “Stapled Unit” on the Toronto Stock Exchange.
Certain statements in this news release contain forward-looking information within the meaning of applicable securities laws (also known as forward-looking statements). These forward-looking statements include, but are not limited to H&R’s plans, objectives, expectations and intentions, including H&R’s expectations regarding future developments in connection with the normal course issuer bid and the receipt of regulatory approvals, H&R’s intention to repurchase Stapled Units in the open market and other statements contained in this release that are not historical facts. Such forward-looking statements reflect H&R’s current beliefs and are based on information currently available to management. These statements are not guarantees of future performance and are based on H&R’s estimates and assumptions that are subject to risks and uncertainties, including those discussed in H&R’s materials filed with the Canadian securities regulatory authorities from time to time, which could cause the actual results and performance of H&R to differ materially from the forward-looking statements contained in this news release. Those risks and uncertainties include, among other things, risks related to: prices and market value of securities of H&R; availability of cash for distributions; restrictions pursuant to the terms of indebtedness; liquidity; credit risk and tenant concentration; interest rate and other debt related risk; tax risk; ability to access capital markets; dilution; lease rollover risk; construction risks; currency risk; unitholder liability; co-ownership interest in properties; competition for real property investments; environmental matters and changes in legislation and indebtedness of H&R. Material factors or assumptions that were applied in drawing a conclusion or making an estimate set out in the forward-looking statements include that the general economy is stable other than in Alberta; local real estate conditions are stable other than in Alberta; interest rates are relatively stable; and equity and debt markets are volatile and access to equity and debt markets is erratic. H&R cautions that this list of factors is not exhaustive. Although the forward-looking statements contained in this news release are based upon what H&R believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. All forward-looking statements in this news release are qualified by these cautionary statements. These forward-looking statements are made as of today and H&R, except as required by applicable law, assumes no obligation to update or revise them to reflect new information or the occurrence of future events or circumstances.
SOURCE H&R Real Estate Investment Trust