Tag: holding

Hispania Launches a Voluntary Tender Offer For Realia With the Aim of Leading Its Recapitalization Process

26/11/2014 – Hispania Activos Inmobiliarios Press Release

Hispania Activos Inmobiliarios, S.A. (Hispania), has sent a communication today to the Spanish Stock Market Regulator (CNMV) informing of its intention to launch a Voluntary Tender Offer (the VTO) for 100% of Realia Business’ existing voting rights through its subsidiary Hispania Real SOCIMI. The Price of the VTO is of 0.49 euros per share, which will be fully paid in cash with Hispania’s own funds. This offer is subject to the acceptance by at least 55% of Realia Business shareholders, as well as to certain waivers by Hispania’s Extraordinary General Shareholders Meeting, which will be called today.

Price of the VTO

The offer is made with a cash consideration of 0.49 euros per share, which reflects, in the opinion of Hispania, the value of Realia’s rental assets, as well as the business plan which Hispania has envisaged for the land and residential promotion assets, taking into account their liquidity and their potential disposal price. Hispania does not provide any valuation report from independent experts of Realia Business’ shares and, therefore, the price per share offered may not be considered equitable price to the effects of the Royal Decree 1066/2007 in case the VTO succeeds, Hispania will start an orderly selling process of such assets in order to focus the Company on its rental business.

Complexity of Realia Business’ current financial structure

In 2013 Realia and its controlling shareholders launched a dual process to, on the one hand, search for resources to cancel the syndicated loan of the land and residential promotion business (the RB loan), which was refinanced at that time, and on the other hand, sell their stakes in Realia Business. Hispania believes that, in accordance with the commitments made in the contract for the refinancing of the land and residential promotion loan, Realia will need to carry out a capital increase amounting to approximately 800 million euro in order to cancel the loan.

Hispania wishes to lead Realia Business’ recapitalization process

Hispania intends to lead this recapitalization process and with this purpose it has reached an agreement with the RB loan current creditors in order to articulate the recapitalization of the company. In addition, and subject to the success of the VTO,

Hispania commits to the effective acquisition of 50% of the RB loan for an amount of 313 million euro.

Subsequently, with the objective of fully repaying this loan, a capital increased will be proposed, for an amount equivalent to 100% of the outstanding amount of such loan at that moment. Hispania has structured this capital increase so that it will be at a price in line with the VTO price and all Realia shareholders will be able to participate, for it will be carried out with pre-emptive rights.

Realia Business’ recapitalization will be guaranteed, because the capital increased will be fully secured by Hispania and by the rest of the RB loan creditors by means of the capitalization of such loan for any unsubscribed amount.

Calling of Hispania’s Extraordinary Shareholders Meeting

The transaction is subject to the waiver of certain limitations set in Hispania’s investment policy. These waivers must be authorised in a Hispania’s Extraordinary Shareholders Meeting which will be called today.

It is expected that the VTO will be completed during the first half of 2015, once the Spanish Stock Market Regulator (CNMV) approves the transaction. In case it were successful, it is expected that Realia Business’ recapitalization will take place during the second half of 2015.

Future of Realia Business

Hispania’s intention, once it has gained control over the company and the recapitalization has occurred, is to become Realia Business’ stable controlling shareholder and to leverage on its experience within the real estate industry to design a business plan which will maximize value for Realia Business’ shareholders in an environment of gradual improvement of the real estate market.

The capital increase will drastically reduce leverage, reducing the company’s risk and putting it on track towards stable dividend distribution.

Realia will focus on its rental business and will discontinue its promotion business, as previously stated.

As part of its business plan, Hispania intends to transform Realia into a SOCIMI and to maintain it as an independent listed company.

Hispania is counting on Realia’s staff, which will find in Hispania a new stable shareholder, committed with the company’s future and well positioned to lead this new phase.

With this investment in Realia, Hispania will have invested in full the funds raised back in March, in its IPO, having consolidated a first-class portfolio across offices, hotels and residential and it will request from its shareholders an authorisation to raise additional capital in the forthcoming General Extraordinary Meeting.

 

The news published by the courtesy of Hispania Activos Inmobiliarios.

GEM Subscribes to €1.48 Mn Capital Increase in Quabit

26/11/2014 – Expansion

GEM Capital has committed to subscription and reimbursement to a €1.48 million capital hike forged by Quabit.

This is the tenth capital injection carried out by GEM (Global Emerging Markets). In the upcoming transaction, 19.48 million new shares of Quabit at a par value of 0.01 euros each and a premium of 0.0664 euros will be allocated on the market.

Last October 31st, Quabit ran an equity line agreed on in a contract signed with GEM in May 2013. In line with its terms and conditions, the company has got a right, but is not obliged, to demand from GEM one or several subscriptions to social capital hikes for a maximum amount of €90 million during a three-year period of time.

 

Original article: Expansión

Translation: AURA REE

FCC Reaches No Agreement With Soros & Turns to Carlos Slim

25/11/2014 – Expansion

Black clouds returned on FCC’s sky. When just a signature was missing on the agreement document allowing George Soros to take a 25% share in the contractor, out of the blue FCC announced the negotiations misfired and now it was in talks with Mexican investor Carlos Slim (pictured).

Mr. Soros was at the verge of buying all the pre-emptive rights of Esther Koplowitz in the upcoming €1 billion capital increase. The transaction would leave Esther Koplowitz with a 25% stake, instead of the current 50%.

The sudden break with Soros caused the contractor to fall on the stock exchange market by 3%.

As FCC informs, ‘the capital hike approved by the latest general shareholders’ meeting is now being exclusively dealt with Control Empresarial de Capitales, a company owned by Inmobiliaria Carso, which in turn belongs to the Slim family‘.

 

Original article: Expansión (by M. L. V.)

Translation: AURA REE

Guggenheim May Join Soros in FCC Capital Hike

24/11/2014 – Expansion

The €1 billion capital hike approved by the shareholders of FCC brings another surprise. Investment fund Guggenheim Partners could join financial magnate George Soros who was bound to subscribe to all increase shares corresponding to Esther Koplowitz (pictured) and take a 25% stake in the contractor. The businesswoman will reduce her holding to a similar percentage as now she owns 50.02% through B-1998.

Final shareholding structure of Fomento de Construcciones y Contratas will depend on the result of negotiations between Soros and Koplowitz teams. Still, the due diligence (or asset valuation) process is pending accomplishment.

It is expected that the final price will be slashed by 25-30% and that may attract some new investors. For instance, Guggenheim could obtain a 5% share.

For the first time, George Soros rescued FCC in December 2013, when the businessman bought a 3% share in the group for €55 million (15 Euros a share).

The current operation is said to be worth €700 million, of which €500 million corresponds to new shares acquisition and the rest to the value of the pre-emptive right of B-1998.

Esther Koplowitz foresees spending the equity on amortization of the €1 billion debt owed to BBVA and Bankia, which the banks prolonged by another 5 years at an Euribor + 250 bps interest rate.

FCC will intend most of the capital hike funds for repayment of the B tranche valued at nearly €4.53 billion. Originally amounting to €1.35 billion, the part grew by another €1.39 billion in interests which step-by-step went on growing annually from 11% to the present 16%. The agreement also involves a 15% write-off on the part of banks.

 

Original article: Expansión (by B. Badía & C. Morán)

Translation: AURA REE

Hispania the Socimi to Pay €151 Mn for Realia & Raise Its Stock Value to €970 Mn

24/11/2014 – Bloomberg, Expansion

As Bloomberg reported Saturday, Spanish REIT Hispania Activos Inmobiliarios, held by such prominent investors as Paulson & Co, submitted a bid of €150.6 million (0.49 €/share) for highly indebted Realia Business.

The deal includes an €791 million issue of new shares. Proceedings from their allocation will be intended for amortization of a syndicated loan from 2009 and reaching maturity in 2016.

Current stakeholders of Realia may take part in the capital hike and in case of any shortfall, creditors would swap their loans for Realia stock in mid-2015. Hispania has come to an agreement with lenders (such as Fortress, King Street and Goldman Sachs) to buy 50% of the loan for €396.5 million (21%-off), provided that the offer is accepted.

Once approval given, Azora-led Hispania will aim at boosting the value of the developer on the stock up to €970 million.

Realia was one of the few developers which survived the real estate bubble burst and subsequent deep recession. At the end of September, the firm’s debt posted €1.07 billion.

Bailed-out Bankia holds 25% in Realia and FCC (or Fomento de Construcciones y Contratas) possesses approximately 37%.

Once the takeover bid accepted and the recapitalization realized, Gross Asset Value (GAV) of Realia’s properties will be equal to €1.22 billion. Moreover, the company will own €951 million in owners capital and a €270 million debt.

Throughout the process, Hispania would invest between €393 million and €470 million to hold between 50.1% and 58.2% of Realia’s capital.

Next step would be to gradually convert Realia into a REIT (Socimi). The operation would include selling 700 dwellings and 1.8 million square meters of residential land out of its balance. Allegedly, the properties would be trasferred to private buyers and not in a bulk within three-five months.

Thanks to the transformation, Realia would pay-off better to its shareholders as 85% of a Socimi’s profits shall be paid-out in shape of dividends.

 

Original article: Bloomberg (by Sharon Smyth), Expansión (by Rocío Ruiz)

Summary & Translation: AURA REE

Fortress, Azora & King Street Submit Takeover Bid For 100% of Realia

20/11/2014 – Expansion

This is the last chapter of the sale of 60% stake in Realia by FCC and Bankia. After nearly a year of dealing with various candidates,  funds Fortress and King Street, together with their Spanish partner Azora were selected and now they are giving the finishing touch to their takeover bid for the entire real estate firm. This morning, Realia was suspended on the stock exchange market just before the opening of tenders ‘due to circumstances that might have disrupted normal trading’. For the same reason has been suspended Hispania Activos Inmobiliarios, a Socimi (REIT) led by Azora.

The proposal of the three bidding winners turned out to be more tempting than the offers of two other fore-runners: Torreal (controlled by Juan Abello) and Colonial that wanted to buy only Patrimonio branch of Realia, encompassing rental buildings and excluding land and residential assets.

Valuation

Realia’s current worth on the stock shows €324 million, with a 27% stock revaluation year-to-date. Its shares trade at 1.06 euros each, an incomparable price to the 6 euros paid in pre-crisis 2007. As of 31th December 2013, the real estate assets of Realia were valued at more than €3.38 billion. Today, after July sale of Siic de Paris, the figures would post around €2.11 billion.

Bankia and FCC strived at selling-off their holdings, first urged by Brussels to divest from non-core assets and the other willing to focus on its own business and cut in debt.

Given the green light, Fortress, King Street and Azora will now submit a 100% bid. The funds already know Realia very well as they have bought two debt portfolios of the firm, one worth €437 million from Sareb and the other valued at €100 million from Santander respectively.

According to data entered in the CNMV’s registries, FCC holds 36.887% in Realia, and Bankia-BFA owns a 24.953% stake. Also, the company is being held by Lualca (5.02%) and Grupo Prasa (5.004%).

 

Original article: Expansión (by R. Ruiz, C. Morán & D. Badía)

Translation: AURA REE

Soros Becomes Strategic Partner of FCC

18/11/2014 – Cinco Dias

U.S. investor George Soros will become the strategic partner of Esther Koplowitz (both pictured) in FCC through a €1 billion capital increase agreement. Thereby, Soros will take on the entire increase amount corresponding to the businesswoman.

George Soros, currently holding a 3.8% share in FCC, will underwrite to 25%. The investor will inject €650 million and buy the pre-emptive subscription right. The price of the new shares has not been disclosed yet.

The contract is said to have been signed for a 4-year term and it implies ratification of the present managing board of the company.

FCC has come to agreements with 75% of its banking lenders, hoping to do the same with the rest. As the firm’s CEO Juan Bejar explained, the talks concern amortization of its €900 million debt and a 15% forgiveness.

Debt Amortization

The builder controlled by Esther Koplowitz will thereby liquidate a €1.39 billion tranche of the amount owned by the group. It currently pays an 11% interest rate bound to rise to 16%.

This way, in case of non-payment, the liabilities will upsurge to nearly €2.26 billion by 2018, and if FCC fails to pay it off again, the banks will seize its shares.

Therefore, the firm is going to intend the €1 billion increase for amortization of 21% of the total debt.

Specifically, €765 million will be destined for liquidating €900 million of this tranche thanks to this 15% release permitted by banks.

Furthermore, €100 million will be received by Cementos Portland, €100 million by FCC Environment and €35 million will be consumed by the transaction costs.

 

Original article: Cinco Días

Translation: AURA REE

Villar Mir Grabs 0.24% More of Colonial

14/11/2014 – Expansion

Grupo Villar Mir has paid its way deeper into Colonial’s stake. The company chaired by Juan Miguel Villar Mir (pictured), already holding 24.4% majority share in the real estate firm, has bought eight million shares more for €4.5 million total, representing a 0.24% stake.

Second main shareholder of Colonial is the Qatar Sovereign Wealth Fund, Qatar Investment Authority (13.1%), followed by Amura Capital (a sicav of MoraBanc) with 7.05% and Aguila (Santo Domingo) with 6.5%.

The Balance

In the nine first months of 2014, Colonial obtained a net profit of €563 million, while a year earlier it lost €369 million during the same period of time. The improvement was a result of deconsolidation of its bad bank, Asentia.

The income proceeding from rentals declined 1.2% to €158 million. During the three past quarters, Colonial has signed lease contracts on 93.860 square meters, with totally new agreements accounting for 53%. Net recurring profit of the firm showed €12.9 million (€1.7 million in 2013). Presently, shares of Colonial sell at 0.579 euros each.

 

Original article: Expansión (by M. Anglés)

Translation: AURA REE

Ahorro & Cecabank Sell AyT to Cerberus

13/11/2014 – Expansion

Savings banks Cecabank and Ahorro Corporación have transferred their two 50% shares in their securitization fund manager to Cerberus.

Ahorro y Titulización (AyT), the bought-out firm, manages 172 securitization funds. Precisely, Haya Real Estate, an arm of Cerberus, put its signature at the deal which provides it with its own securitization fund in Spain, suitable both for own and the third parties’ investments.

The transaction is a part of Ahorro Corporación‘s non-core asset divestment plan, involving changes in stake-holding to give a way out to such big entities as CaixaBank or Bankia which, due to having absorbed small savings banks, have no interest in staying in it.

Besides, Ahorro Corporación is currently in talks with Abanca (former NCG Banco) on the sale of its investment fund. Also, the company ponders options on what to do with its real estate arm, AC Patrimonio Inmobiliario. It can convert it into a Socimi, liquidate the €100 worth of assets inside the vehicle, or sell it to a foreign investor. Other entities decided to dispose of similar type of funds, like Bankia closing its vehicle’s asset transfer to Goldman Sachs.

The goal of Ahorro Corporación has been set to focus on advisory and intermediatory services (AC Financiera SV, accounting for two-thirds of its revenues), including those provided to foreign investors, as well as finding new partners to enter its stake. CecaBank, BMN, Kutxabank, Unicaja, Ibercaja Liberbank and Abanca presently hold shares in Ahorro Corporación.

 

Original article: Expansión (by Elisa del Pozo), full: Orbyt (by J. Zuloaga & E. del Pozo), pp 17

Translation: AURA REE

Sareb & Popular Get Equity Stakes in Renta Corporación

12/11/2014 – Expansion

At the latest Renta Corporación stakeholders’ meeting, a capital increase was approved which will allow four banks to grab 14% of the firm’s capital in exchange for debt cancellation. Namely, Sareb, Banco Popular, ING and Banco Caixa Geral opted for the swap inside the last covenant arrangements.

Once the green light given to the operation, €5.6 million in new shares at €1 face value each will be issued, representing 14% of the company’s social capital fixed at €32.88 million in total.

Sareb will take a 4.9% share by swapping the debt proceeding from Caja Madrid and Bancaja. Banco Popular has got a right to 4.1%, ING Real Estate to 2.9% and Banco Caixa Geral to 2.8%. Deutsche Bank which held a 2.8% stake finally split it half and sold to two investors.

The increase hands 14% over to the banks, 7% remains in possession of other significant shareholders and the rest of Renta Corporación belongs to its president Luis Hernandez de Cabanyes (32%) and Blas Herrero (8%). The free float makes 39% available.

The stakeholders also agreed that two payment schemes will apply in 2014, one in favor of the emplyees and directors and the other in benefit of Renta’s CEO, David Vila.

On the Stock Market

Floated in 2006, the firm has been suspended since March 2013 when it went bankrupt. However, last October 30th, Renta Corporación returned to the stock exchange market and appreciated 154% to 1.45 €/share in the very first day.  Since then, the price has been fluctuating and currently the shares stand at €1.11 each.

 

Original article: Expansión (by M. Anglés)

Translation: AURA REE