Why the Unibail (ASX:URW) share price has fallen 3% today

The Unibail (ASX: URW) share price has fallen 3.4% today despite a strongly oversubscribed placement. We take a closer look.

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The Unibail-Rodamco-Westfield CDI (ASX: URW) share price has fallen today after the company announced an oversubscribed placement. Shares in Europe’s largest commercial real estate provider are trading 3.47% lower at a price of $5.00.

The placement comes in a month which has seen the Unibail share price rocket up 74%.

What happened?

Last night, the real estate investment trust (REIT) announced plans to raise up to 1 billion euros through 6 and 11-year bonds. The offer was set to expire on 1 December but received enormous support and consequently, the results have already been released. The two bonds on offer were:

  • A 1 billion euro bond with a 6-year and 5 months maturity and a 0.625% fixed coupon
  • A 1 billion euro bond with an 11-year maturity and a 1.375% fixed coupon.

Unibail also said net proceeds from the offer would be used for general corporate purposes including the funding of the concurrent tender offer as well as refinancing upcoming bond maturities.

Placement complete

As mentioned, the offer was wrapped up in record time with Unibail announcing its completion later in the day.

The REIT successfully priced its 2 billion euro two-tranche senior bond offering, strengthening its liquidity position and extending its debt maturity as a result.

The issuance was more than three times subscribed, with Unibail stating that it received more than 6.5 billion euros in demand.

What now for the Unibail share price

The Unibail share price has soared in recent weeks, marking a stark change in fortune for the company which was hard hit by the COVID-19 pandemic. However, the REIT is still a long way off its 52-week high of $11.68 earlier in the year.

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