Quabit Signs Debt Refinancing Agreement With Sareb

24 September 2015 – El Día

The real estate company Quabit has completed the process to restructure the debt it holds with Sareb (which represents 72% of the group’s financial debt) and postpone the final repayment from 2016 until 2022.

Under this new agreement, Quabit agrees to make an early payment of €35.6 million before the end of the year, which will enable it to free up those assets that have potential for short term development. According to a statement from the company, it plans to develop almost 1,000 homes on those sites.

The signing of this agreement will give Quabit the option to conduct the capital increase, approved by its General Shareholders’ Meeting on 30 June, amounting to approximately €70 million.

At the same time, it involves the postponement of the repayment of the remaining debt until 2022, and establishes a calendar of annual payments, which increase as follows: 5.6% over the next three years; 31.4% over the following three years; and 63% in 2022.

Moreover, the agreement establishes compulsory early repayments of 20% of the debt, both in the event of the amounts received as the result of any capital increase (not applicable to the capital increase approved at the most recent General Shareholders’ Meeting), as well as the operating cash for each financial year.

In addition to the forecast compulsory debt repayments, Quabit may make voluntary early repayments for assets of its own choosing, to release them and individually promote their development and subsequent sale.

According to the President of Quabit, Félix Abánades, the company is poised to become a leading player in the Spanish real estate sector once more.

The signing of this agreement, he adds, will allow the group to manage and develop the company’s assets and to realise the capital increase that it is planning to carry out.

On 10 June, Quabit announced that it will increase its own funds by €189 million over the next few years by activating all of the tax credits it has pending, following the successful conclusion of the capital increase that will be proposed at the company’s next General Shareholders’ Meeting.

Original story: El Día

Translation: Carmel Drake

Slim Set To Acquire Realia After Hispania Withdraws Its Bid

24 July 2015 – Expansión

The Mexican businessman, who already owns 25% of the real estate company, has now been given free rein to make an agreement with Realia’s creditors.

The takeover war for Realia came to an end on Wednesday, one day before the deadline for its approval. The Socimi Hispania Real, a subsidiary of the listed company Hispania, announced on Wednesday that it was withdrawing its public bid to acquire Realia’s shares, which it had launched in November 2014.

Hispania’s Board of Directors have decided to withdraw, rather than improve, their bid of €0.49 per share, despite the offer (€0.58 per shares) submitted by their competitor, the Mexican businessman Carlos Slim, through his real estate company Carso.

Hispania’s decision leaves Realia’s shareholders with just one alternative, the one presented by Slim, who already controls 24.9% of the real estate company, after he purchased the stake previously owned by Bankia.

Nevertheless, it seems unlikely that this bid will be successful either. According to sources close to the process, the percentage of shareholders agreeing to Carso’s bid did not exceed 1% of the capital on Wednesday, a situation that would not only not harm Slim’s interests, but that would actually benefit him by preventing the creditors from executing Realia’s debt.

Lower price

The offer presented in March by the Mexican businessman falls well below the listed price of the real estate company. The company’s shares closed trading on Wednesday at €0.705, despite having fallen by 2.08%, to place the market capitalisation of the company at €216.7 million. Slim’s bid price values Realia at €30 million less.

The change in control of Realia would result in the early repayment of the €1,170 million debt held by the real estate company. Almost €800 million of that amount was loaned by the funds Fortress, King Street and Goldman Sachs. Those three creditors had made an agreement with Hispania to not enter into negotiations with any other candidate regarding the purchase of Realia for 10 months. Now that the Socimi has withdrawn its takeover offer, that agreement is void.

That loan is due to be repaid at the end of 2016. If Slim does not acquire more than 30% of Realia, then the change of control clause will not be invoked and no early repayment will be required.

Even if he does not manage to buy more shares, Slim may still be able to control Realia with the support of FCC, in which he is primary shareholder, with a 25.6% stake. The construction company, which owns 36.9% of Realia, has said that it would not sell its stake in the event of a takeover.

In his takeover prospectus, Slim – who is being advised in this process by the law firm Ontier – considered the possibility of negotiating with the creditor funds to capitalise some of the loan, amongst other options – he also considered undertaking a capital increase, whereby allowing new shareholders to enter and diluting his own shareholding.

During the first quarter of 2015, Realia generated turnover of €23.3 million, i.e. 33.9% less than in 2014, whilst its net profit amounted to €170,000, compared with a loss of €7.6 million in the previous year.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake