12 August 2016 – Expansión
Metrovacesa and Merlin have both convened General Shareholders’ Meetings on 15 September 2016, in order to approve their merger. Before the operation, the companies will distribute a combined dividend amounting to €116 million in total. Specifically, Merlin will distribute a maximum of €66 million to its shareholders, whilst Metrovacesa will pay out €50 million.
The agreement between Merlin and Metrovacesa includes a penalty of €75 million, plus the reimbursement of costs incurred, in the event that their respective General Shareholders’ Meetings do not approve the operation.
In addition to approval from the shareholders, the merger requires the green light from the Competition authorities. The companies notified the CNMC about the deal at the end of July and, according to the agreed timetable, the transaction will be completed in the fourth quarter.
The merger will give rise to a new real estate giant in the tertiary sector – offices, shopping centres, logistics warehouses and hotels – with a gross asset value (GAV) of €9,300 million and annual gross rental income of €450 million.
In addition, the operation will involve the grouping together of rental homes from Metrovacesa and Testa – owned by Merlin. The combination of the residential businesses of both groups will include more than 4,700 homes, with a GAV of €979 million. Testa Residencial will take on bank debt amounting to €250 million.
It is expected that Merlin will render advisory, planning and strategic management services to Testa Residential for a period of 30 years from the operation close, for a cost of €7.7 million p.a., which may be increased by 1.5% p.a. and which may be paid for through the capitalisation of shares.
Original story: Expansión (by Rebeca Arroyo)
Translation: Carmel Drake