UK Mortgages Ltd Portfolio Disposal Announcement

 
TIDMUKML 
 
UK Mortgages Ltd: Portfolio Disposal Announcement 
 
THE INFORMATION IN THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR PUBLICATION, 
RELEASE OR DISTRIBUTION DIRECTLY OR INDIRECTLY IN OR INTO OR FROM THE UNITED 
STATES, CANADA, AUSTRALIA, THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF 
IRELAND OR JAPAN. 
 
8th February 2021 
 
                             UK MORTGAGES LIMITED 
 (a closed-ended investment company incorporated in Guernsey with registration 
                                 number 60440) 
 
                           LEI 549300388LT7VTHCIT59 
 
Agreement to Dispose of Two Portfolios Under Revised Strategy 
 
The Board of UK Mortgages Limited ("UKML", or the "Company") and TwentyFour 
Asset Management LLP ("TwentyFour") are pleased to announce that on Friday 5th 
February 2021, UK Mortgages Corporate Funding Designated Activity Company ("UK 
DAC") signed agreements under which, Godiva Mortgages Limited ("Godiva"), a 
subsidiary of Coventry Building Society ("Coventry") has made a commitment to 
purchase two buy-to-let mortgage portfolios originated by Godiva and currently 
financed within the Cornhill No.6 and Malt Hill No.2 vehicles. Subject to 
successful completion, the timing of these sales is expected to coincide with 
the payment dates in February and May 2021 respectively. Strong market 
conditions have enabled these portfolios to be disposed of at economics that 
improve on those indicated to investors in late 2020 and also ahead of 
anticipated timing for the Cornhill No.6 portfolio. 
 
On the 4th December 2020, shareholders voted overwhelmingly in favour of an 
updated strategy for UKML. The first objective was achieved on the 15th January 
2021 through the successful securitisation of existing Keystone BTL loans in 
the inaugural Hops Hill No.1 transaction. As the first European RMBS 
transaction of 2021, this transaction locked in better funding levels when 
compared to those achievable in the fourth quarter of 2020, improving income 
materially. 
 
The second phase of the strategy aimed to free up capital, initially through 
the sale of the two Coventry portfolios, to enable capital to be returned to 
shareholders by way of a tender and to fund the second Keystone investment. The 
combination is expected to increase capital efficiency and to continue the 
growth trajectory of income. Today's announcement marks a significant milestone 
in achieving this second strategic aim. 
 
On behalf of UK DAC, TwentyFour has simultaneously mandated a warehouse 
provider for the second Keystone investment and has commenced documentation 
work with an expectation of completing during March. Material improvements in 
overall funding conditions will benefit this new investment over its life. 
 
The sale of the two Coventry portfolios is expected to release capital enabling 
two tenders to be carried out, returning an aggregate at the higher end of the 
previously communicated £35-40 million range. These tenders are expected to 
take place following the payment dates expected to be in February and May 
respectively. The Board's expectation is that the tenders will take place at 
75p per share. 
 
Chairman Chris Waldron commented, "We are pleased to deliver this important 
transaction ahead of schedule providing enhanced certainty for shareholders and 
further advancing the updated strategy." 
 
Douglas Charleston commented, "This sale represents the first portfolio 
disposal for UKML. Its successful conclusion is recognition of the high quality 
of assets within the fund. We are pleased to work again with our close partner, 
Coventry." 
 
TwentyFour Asset Management LLP 
Douglas Charleston 
020 7015 8900 
 
Numis Securities Limited, Corporate Broker 
Hugh Jonathan 
Vicki Paine 
020 7260 1000 
 
 
Important notice 
 
This announcement has been prepared for information purposes only, it is not a 
prospectus. 
 
The distribution of this announcement in certain jurisdictions may be 
restricted by law. Persons into whose possession this announcement comes are 
required by the UKML, TwentyFour and Numis to inform themselves about, and to 
observe, such restrictions. 
 
Recipients of this announcement who are considering acquiring New Shares in 
UKML are reminded that any such acquisition must be made only on the basis of 
the information contained in the Prospectus and any supplementary prospectus 
(es) thereto which may be different from the information contained in this 
announcement.  This announcement does not constitute or form part of and may 
not be construed as an offer to sell, or an invitation to purchase, investments 
of any description, nor as a recommendation regarding the possible offering or 
the provision of investment advice by any party.  No information in this 
announcement should be construed as providing financial, investment or other 
professional advice and each prospective investor should consult its own legal, 
business, tax and other advisers in evaluating any investment opportunity.  In 
particular, an investment in UKML involves a high degree of risk and 
prospective investors should read the section in the Prospectus entitled "Risk 
Factors" for further information. 
 
 
 
END 
 
 

(END) Dow Jones Newswires

February 08, 2021 07:52 ET (12:52 GMT)