Land Securities confirms that, following the Extraordinary General Meeting held today, 15 December 2006, at which shareholders approved changes to its Articles of Association, it will be taking the necessary steps for Land Securities and its subsidiaries (the "Group") to convert to a Real Estate Investment Trust ("REIT") on 1 January 2007.
This conversion will be effected by way of a notification letter to HM Revenue & Customs and will result in the payment of a conversion charge in July 2007. The conversion charge, which is expected to be in the order of £300m, will be 2% of the value of the Group's qualifying property assets.
In order to quantify the precise amount of the conversion charge, the Group will be carrying out a valuation of the relevant assets as at 31 December 2006. This will be a one-off exercise and will include an external valuation of both the qualifying properties held in the investment property business together with the qualifying properties held by Land Securities Trillium, representing the first valuation of these assets since Trillium was acquired in 2000. It is anticipated that the results of the valuation will be announced to shareholders in February 2007.
Commenting on the conversion, Francis Salway, Group Chief Executive of Land Securities, said: "We are confident that our conversion to REIT status will bring benefits to shareholders in terms of the Group's tax efficiency and are excited to be one of the first companies to take advantage of the new legislation. We look forward to the increased dynamism this change will bring to the sector."
Land Securities received valid proxies for the Extraordinary General Meeting in respect of 270,109,027 shares. Votes in respect of 267,749,235 shares, representing over 99.1% of the shares subject to valid proxies, were cast in favour of the Resolution or left to the Chairman's discretion; votes in respect of 56,038 shares, representing 0.02% of the shares subject to valid proxies were cast against the Resolution; and votes in respect of 2,303,754 shares, representing 0.85% of the shares subject to valid proxies, were withheld.
Source: Land Securities