Business
LFL Announces Intention to Create Real Estate Investment Trust
Toronto, Ontario--(Newsfile Corp. - May 4, 2023) - Leon's Furniture Limited (TSX: LNF) (" LFL "...
About this update from Leon's Furniture Limited
[{"type":"text","content":"LFL Announces Intention to Create Real Estate Investment TrustToronto, Ontario--(Newsfile Corp. - May 4, 2023) - Leon's Furniture Limited (TSX: LNF) (\"LFL\" or the \"Company\"), today announced its intention to create a Real Estate Investment Trust (the \"REIT\"), which is expected to unlock significant shareholder value while positioning the Company to accelerate growth. LFL has an attractive real estate portfolio of approximately 5.2 million square feet of wholly-owned real estate from which it will vend in a significant portfolio of assets to the REIT. LFL is currently exploring various strategic alternatives for the REIT transaction which could involve an initial public offering of the REIT or a shareholder approved spin out of the REIT to LFL shareholders. It is LFL's intention to maintain a majority ongoing ownership interest in the REIT. Timing of the transaction will be subject to prevailing market conditions and receipt of required regulatory approvals including approval to list the units on the Toronto Stock Exchange.LFL expects the creation of the REIT to:Unlock value for LFL shareholders by surfacing the market value of the Company's significant portfolio of cash flow generating real estate properties;Create a vehicle that is expected to have a cost of capital advantage, a built-in growth pipeline of future property vend-ins from LFL, and a management team focused on growing and optimizing the portfolio; andLower the cost of capital for LFL and provide capital to invest in growth opportunities.Mike Walsh, President and CEO of LFL, commented, \"The creation of the REIT is expected to surface the value that is currently hidden within the Company's significant real estate portfolio, while ensuring both management teams are able to execute value-maximizing strategies for shareholders. Capital that LFL receives as part of this transaction is expected to go toward growth and efficiency opportunities, including accelerating the modernization of the Company's distribution centre footprint. LFL has delivered value for its customers and generated results for its shareholders over a 100+ year history, and I know I speak on behalf of our entire senior management team and board of directors when I say that based on the opportunities we see in front of us, it feels like we are only just beginning our journey together.\"Constantin...