Quabit to set up a company to finance new projects
21 May 2015 – Expansión
Quabit, the listed real estate company, will address two new proposals to harness the sector’s ongoing recovery at its next general shareholders’ meeting on June 30.
On the one hand, the company will submit a proposal – for its shareholders’ approval – to carry out a capital increase operation for approximately 70 million euros. The operation is to be performed with cash contributions by issuing and circulating common stock – a maximum of 1 billion shares, at one cent each. The expansion, which will have preferential subscription rights, aims to raise funds for new projects, said Quabit.
A new company
At the meeting, the real estate company also proposed bundling several assets, mainly land properties with great potential, into a company where external partners, such as foreign funds, could also participate.
The new company, which could either be an already existing subsidiary or a newly created firm, will be comprised of assets that may not amount to more than 25% of the total value of the group’s assets. The goal of this project is to “enable [them] to obtain more efficiently new lines of financing for the company’s activities and, hence, raise funds to kickstart new projects. This transfer of assets would facilitate getting financial resources for promotion and sale within a 3-5 year timeframe,” said sources from the company.
In the first quarter of 2015, Quabit registered sales of over 1 billion, compared to the mere 47.5 million it brought in the previous year, when it negotiated a sale of assets with banks to reduce its debt. From January to March, the real estate company, whose largest shareholder is the construction group Rayet, reported a loss of more than 4 billion euros.
Original story: Expansión (by R. Ruiz)
Translation: James Leahu