DNZ Property Fund in $130m capital raising 

Source: ONE NewsCommercial property leasing and renting

DNZ Property Fund is looking to raise $130 million as part of its bid to list on the stock market.

Company chairman Tim Storey says the company has been reviewing its strategy and believes raising capital and a proposed listing is best for shareholders and the company in the long run.

The $130 million capital raising would go towards reducing existing bank debt and new management arrangements.

"We believe it is important to reduce our gearing to levels more appropriate in the current market and to levels that would ensure support from institutional and other new investors," Storey says.

Under new management arrangements it will end its management contract with DNZ Management Ltd and internalise that within DNZ.

The $130 million offer is made up of $100 million for institutions and NZX primary market participants, and $30 million for existing shareholders.

There is also an allowance for up to $10 million of oversubscriptions.

The offer price is 82 cents per share, following the two for five share consolidation undertaken earlier this week. 

DNZ says there has been strong interest in its capital raising from institutional investors. As part of the share offer, existing shareholders may be able to sell their shares concurrently with the offer at the same price.

DNZ executive chairman Simon Botherway, who was recently appointed to the board, says he is excited to be part of a company putting in place best practice governance arrangements which will "distinguish DNZ as a listed property investment".

Storey says listing is the "next logical step" after nine years of amalgamating its trusts and funds.

DNZ has 61 commercial office, retail and industrial properties nationwide.