Tag: compensation

Testa Compensates Merlin with 4.2% of its Share Capital in Exchange for Management Freedom

27 March 2018 – El Economista

Testa is starting to go it alone. The Socimi has decided to terminate the management contract that it had with Merlin Properties, which has been in force since 2016. Following the recent incorporation of the new CEO, Wolfgang Beck, the real estate firm considers that it has the structure and staff necessary to carry out the management of its portfolio itself internally. Thus, at the last extraordinary general shareholders’ meeting, a decision was taken to cancel the contract with Merlin, which will receive new shares in Testa by way of compensation.

Specifically, Testa is going to carry out a capital increase amounting to €89 million, which the Socimi led by Ismael Clemente will subscribe to in its entirety, whereby increasing Merlin’s stake in Testa from its current level of 12.7% to 16.9%.

The rental housing Socimi notified Merlin of its decision in January. Until now, it had been receiving annual remuneration of €7.7 million for advisory and management services.

Merlin, which is Testa’s fourth-largest shareholder, behind Santander (38.8%), BBVA (26.9%) and Acciona (21%), already announced, at its results presentation, its intention to divest its position in the Socimi when it makes its stock market debut, a step that it is expected to take place between May and June this year.

Within the framework of procedures to complete prior to its stock market debut, Testa also approved the execution of a counter split of one new share for every 100 existing shares. Thus, it will give its four existing shareholders one new share with a nominal value of €1 each for every 100 shares that they currently own, which have a nominal value of €0.01 each. Moreover, the new shares will be represented by book entries.

With a workforce comprising more than 80 employees, Testa has positioned itself as the largest owner of rental homes in Spain with a portfolio of 10,702 units in less than two years.

It closed its most recent purchase last week after reaching an agreement with the BuildingCenter, the real estate subsidiary of the CaixaBank group, for the acquisition of 1,458 homes for around €228 million.

Original story: El Economista (by Alba Brualla)

Translation: Carmel Drake

Colonial Pays Its First Dividend In 10 Years

5 July 2016 – Expansión

Colonial will distribute a gross dividend of €0.015 per share to its shareholders today.

Colonial is making dividend distributions again, ten years after it suspended such payments to its shareholders. The real estate company is rewarding its shareholders now that it has completed its recent restructuring and after closing 2015 with a profit of €415 million and a record number of lease contracts.

Colonial will thereby become the first real estate company of those that have managed to overcome the crisis to start paying dividends again, after it also became the first to achieve an investment grade rating from a ratings agency in 2015.

As such, with the recovery of payments to its shareholders, the company has definitively completed the process to clean up, restructure and return to growth that it embarked upon a few years ago and which involved the entry of new shareholders into its capital.

Currently, Colonial’s two largest shareholders are the Qatari sovereign fund, with a 13% stake and the Grupo Villar Mir, with a 9.2% stake, which will thereby receive €6.23 million and €4.43 million in dividends, respectively.

The company’s new third largest shareholder, the Mexican group Finaccess, will receive €4.3 million for the 8% stake that it just purchased in the company in exchange for a batch of assets.

The other high profile shareholders of the real estate company include the Andorran bank MoraBanc, which holds 7%, the Colombian group Santo Domingo (6.8%), the British billionaire Joseph Charles Lewis (5%), the Reig group with a 2.5% stake and several investment funds, which hold between 1.9% and 3% each.

Following the capital increase, which saw the entry of two new shareholders (Finaccess and Reig), and the dividend payment, Colonial is now waiting to carry out another item on the agenda approved at the last General Shareholders’ Meeting: a “reverse share split” of ten shares for one.

The company chaired by Juan José Brugera defines all of these operations within the growth strategy that it is currently undertaking, which has involved expanding the business focus, beyond its three traditional markets (Madrid, Barcelona and Paris) to analyse operations in other European capitals.

Original story: Expansión

Translation: Carmel Drake