BB Healthcare Trust plc share offer

  • Intermediaries offer
  • Market: LSE-Premium Segment
  • Sector: Equity-Biotechnology

Offer Now Open

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BB Healthcare Trust plc share offer

18th November 2018

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, TO THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN OR ANY MEMBER STATE OF THE EEA (OTHER THAN THE UNITED KINGDOM) OR TO ANY NATIONAL, RESIDENT OR CITIZEN OF THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN OR ANY MEMBER STATE OF THE EEA (OTHER THAN THE UNITED KINGDOM)

BB Healthcare Trust plc - Offer Overview

  • Market cap: £428.39m
  • Offer size: 100 million shares
  • Price: 131.4 pence per new ordinary share

Expected Timetable

  • Offer Open

    5th November 2018 

  • Books Close:

    28th November 2018

  • Allocation announced:

    29th November 2018

  • Trading begins:

    3rd December 2018


About the BB Healthcare Trust plc

BB Healthcare Trust plc operates as a closed-ended investment company. The trust invests on listed or quoted global healthcare companies with an investment objective to produce a higher total return than that of the MSCI world healthcare index (in sterling) and to generate double digit total shareholder return (per annum).

Investment policy:

  • Company must be in the global healthcare industry
  • Companies in the global healthcare industry will typically include industries such as pharmaceuticals, biotechnology, medical devices, healthcare insurers, facility operators, drug retailers, technology in healthcare and consumer healthcare and distribution
  • The investment must be listed or quoted
  • BB healthcare may also invest in ADRs or convertible instruments issued by companies meeting the investment criteria
  • No single holding will hold more than 10 per cent of the groups gross assets at the time of investment
  • Once fully invested BB healthcare expects the portfolio to have no more than 35 holdings
  • Management aim to have a highly liquid portfolio such that 90 per cent of holdings may be liquidated in a reasonable number of trading days
  • BB healthcare will not invest in other funds or unlisted companies

Highlights
  • The group has a strong investment policy
  • The company currently has 29 investments with an unaudited value of £436m
  • Top ten investments represent 54.6 per cent of the total portfolio value
  • Examples of current investments made by BB Healthcare incl. Align Technology, Anthem, Celgene, Humana, Illumina and Teladoc to name a few.
  • Across healthcare sub-sectors the trusts portfolio includes Biotech, Diagnostics and Med-Tech (which make up 45.5% of the groups portfolio) managed care, dental, healthcare IT and distributors to name a few.
  • The groups portfolio has exposure across Europe, Asia and the United States
  • Attractive dividend policy with a target dividend equal to 3.5% of NAV
  • The global healthcare market is currently estimated to be worth in excess of US$7.9 trillion
  • Growth in the healthcare sector is supported by changes in demographics pointing towards an aging population in developed countries, increase in income in middle income and developing jurisdiction
  • Greater knowledge of tailored treatment is giving rise to targeted interventions creating a market for a variety of treatments focusing on the individual
  • Potential investment goes through a vigorous multi-stage due diligence process. Alongside business fundamentals the investment manager considers daily liquidity and financial disclosure

Use of Proceeds
  • To execute the groups investment strategy

Risks*
  • The group has limited operating history therefore the past performance of the trust is not a reliable indicator of the investment manager’s future performance
  • Past performance is no guarantee of future success
  • General economic performance across countries to which the portfolio is exposed to, may affect the performance, value or development of investments
  • The company has no employees and is reliant on third party service providers
  • Loss of key personnel
  • Failure to conduct sufficient due diligence on prospective investments may result in the trust investing in firms which do not meet the companies investment criteria, are significantly over valued or have fundamental operating flaws which may impact their expected growth forecasts
  • Market sentiment towards healthcare businesses may impact the underlying value or the return at exit of investments
  • Over exposure to particular jurisdictions, sub-sectors or business may result in greater volatility in the value of trusts NAV
  • Currently the groups portfolio is heavily weighted towards the US which may leave the NAV overly exposed to the US economy and financial markets
  • Regulatory risk effecting investments or the ease at which BB healthcare can invest in listed businesses may impact the groups ability to gain exposure or the ability of investments to operate
  • Exchange rate risk
  • Other risks associated with listed investment trusts
  • Other risks associated with LSE listed stocks

*Please note that these risks represent the judgement of Cornhill Capital, there may be additional risks represented in the prospectus


Offer Documents

Important information

Our service at a glance

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Risk Warning pre-IPO’s, IPO’s & Secondary Issues

Investments in pre-IPO’s and IPO’s involve a high degree of risk and are not suitable for all investors. A pre-IPO issue is the funding given to the company before listing. There is no guarantee that the company will list, but if it does then there is normally an increase from the pre-IPO to the IPO price, representing a profit. However, even when a company is listed on, say,  the AIM market, it is considered to be a high-risk investment, and will have wider spreads on price and be more illiquid and it may be difficult to sell the shares on a short-term basis and in some circumstances it may be difficult to sell at any price. All investments made into an IPO or new issue or in a secondary issue should always be made solely on the basis of the information provided in the relevant prospectus and any other supplementary documentation. The specific risks will be detailed in the prospectus but the value of your investment can go down as well as up and you may not get back the money you invested.  You should be sure that you fully understand the purpose of, and the reason for, the fundraising. Before you decide to invest you should obtain information regarding the business plan and note the risk factors. If you have any doubts about the suitability of an investment you should seek professional advice.

This announcement has been published by Cornhill Capital Limited.