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NorthWest Healthcare Properties REIT launches C$200M bought-deal unit offering

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Capital Markets View – January 2021


NorthWest Healthcare Properties REIT launches C$200M bought-deal unit offering

NorthWest Healthcare Properties REIT is offering 16.4 million of its trust units at C$12.20 apiece on a bought-deal basis for gross proceeds of roughly C$200.1 million.

The Canadian healthcare real estate investment trust granted the underwriters a 30-day overallotment option to acquire up to 2,460,000 additional units.

The REIT also agreed to sell 2,049,180 of its trust units to its largest shareholder, Northwest Value Partners Inc., in a nonbrokered private placement to raise about C$25.0 million in gross proceeds. The private placement is slated to close in January 2020.

NorthWest Healthcare aims to use the net proceeds to repay C$191 million of corporate debt. This includes the 5.25% convertible debentures due Sept. 30, 2020, with approximately C$40.3 million outstanding and a conversion price of C$14.20 per unit, as well as the 5.50% series D convertible debentures due Oct. 31, 2020, with roughly C$52.8 million outstanding and a conversion price of C$11.25 apiece.

Part of the net proceeds will also go toward the REIT's planned acquisition of two clinics in Germany and a medical office building in the Netherlands for about C$68.5 million, with closing expected to occur by the first quarter of 2020.

BMO Capital Markets, RBC Capital Markets and Scotiabank are leading the syndicate of underwriters for the public offering, which is expected to close on or about Dec. 19.