LONDON, July 7 (Reuters) - UK Mortgages, an investment fund focused on Britain’s residential mortgage market, said on Tuesday it had raised gross proceeds of 250 million pounds to build a portfolio of loans that offer stable income streams in volatile financial markets.
The fundraising was executed via a placing and open offer of ordinary shares at an issue price of 100 pence per share and attracted demand in excess of 325 million pounds ($505.28 million), the company said.
Headquartered in Guernsey, UK Mortgages is run by TwentyFour Asset Management and targets a net total return of 7-10 percent a year.
UK Mortgages Chairman Chris Waldron said the funds were raised in a “significantly oversubscribed fundraising,” adding that “the demand for the product is testament to the asset class’ potential returns.”
“The income potential and historically low correlation to other asset classes has clearly appealed to investors,” said TwentyFour Chief Executive Mark Holman.
UK Mortgages aims to pay a dividend of 3 pence per ordinary share for the financial year ending June 30 2016 with a first interim dividend to be paid in April 2016.
Numis Securities Limited acted as UK Mortgages’ broker and financial adviser and will continue working with the company. ($1 = 0.6432 pounds) (Reporting By Pamela Barbaglia, editing by Sinead Cruise)