Metrovacesa Prepares Stock Market Debut for February 2018

23 November 2017 – Eje Prime

The stock market is getting ready to welcome yet another real estate group. Metrovacesa, the property developer controlled by Santander and BBVA, will make its debut on the stock market in February 2018. The company has convened an Extraordinary Shareholders’ Meeting for 19 December to approve its return to the trading floor. Moreover, the company is currently negotiating a syndicated loan amounting to €250 million to finance future operations.

According to the information included in the meeting invite, the shareholders will also have to approve a ‘contra-split’ of their shares, equivalent to one new share for every 45 existing shares. They will also be asked to approve some new corporate by-laws for the company and to fix the number of directors along with their policies and remuneration plans.

Metrovacesa stopped trading in 2013 after an exclusion bid was presented by the financial institutions that ended up controlling the real estate company following the process to refinance its debt.

Currently, its capital is shared between Banco Santander (61.1%), BBVA (29.64%) and Banco Popular (9.21%), which will divest their shares with the stock market debut.

Following a capital increase amounting to €1.108 billion, which was completed by the contribution of assets from the three banks, Metrovacesa has assets worth more than €2.6 billion and a land portfolio that exceeds 6 million m2, on which 40,000 homes may be built.

Before the stock market debut, the shareholders are going to undertake another non-monetary capital increase amounting to €316.7 million, which will be submitted for approval at another shareholders’ meeting, to be held this Friday, on the first call, or this Saturday, on the second.

Loan for €250 million  

In addition, Metrovacesa is negotiating a syndicated loan with various banks. The initial idea was to structure it into two tranches: one amounting to €220 million, to be used to fund the distribution of a dividend before the company’s debut on the stock market; and another for €180 million, aimed at financing the property developer’s future operations.

According to sources familiar with the process, this first proposal has been rejected by the main entities invited to form part of the syndicate, which have asked Santander and BBVA to lower their dividend expectations. Meanwhile, Metrovacesa is preparing a new proposal that will likely decrease its debt balance by between €250 million and €400 million and eliminate the amount allocated to remunerate the shareholders.

Original story: Eje Prime

Translation: Carmel Drake