Tag: JZ Real Estate

Holdreit Negotiates Sale of the Socimi Kingbook & its Exclusion from the MAB Before June

23 May 2018 – Eje Prime

Besides the purchase of assets and their subsequent management, Spain’s Socimis are also gradually starting to enter the business of corporate operations. Such is the case of Holdreit, which is negotiating with an investor to sell 100% of its Socimi specialising in gas stations, Kingbook, according to sources at the company speaking to Eje Prime. If the operation is closed before the end of June, the new owner will exclude the Socimi from the Alternative Investment Market (MAB), where its shares are currently traded.

The Socimi, owned by Holdreit, the company’s sole shareholder and controlled by GL Europe Reit (60%) and JZ Real Estate (40%), has been subjected to a due diligence process by an investor, whose name has not been revealed.

The purpose of this study is to purchase 100% of the shares in Kingbook Inversiones Socimi. “This offer is being analysed by both the shareholder and the Board of Directors, and the month of June 2018 has been set as the period for the acceptance and signing of the operation. During that time, all of the due diligence and legal work is expected to be completed successfully”, explain sources at the group.

In the event that the aforementioned due diligence process is concluded satisfactorily and “in the best interests of the company, the sole shareholder will request the exclusion from trading of all of the shares no later than 30 June 2018”, they explain. In this way, Kingbook would cease to trade on the MAB.

The Company’s Board of Directors has agreed to ask Renta 4 to begin the appropriate procedures to obtain a one-off exoneration from compliance with its “selling obligations under the liquidity contract signed with the company” from the Market Supervisory Committee, as a step prior to the sale of all of Kingbook’s shares.

The group’s complicated financial situation could be one of the reasons for the sale of the Socimi. At the beginning of the month, Kingbook injected additional funding of €1.4 million in order to “reduce the company’s demandable liability and increase its own funds”. Following that increase, the company’s share capital amounted to €10.9 million.

This move by Kingbook comes after the Socimi increased its share capital by €21.6 million last November to offset losses. The company explained that the Socimi has been generating losses since it started operations. As at 30 September 2017, the result for the year was negative, with losses of €1.25 million (…).

Nevertheless, Kingbook owns a solid portfolio of assets that could prove attractive to a new investor. The company owns land worth €10.3 million and buildings worth €20 million (…).

Moreover, last year, Kingbook added more than a dozen service stations to its real estate portfolio. (…). In total, Kingbook spent €7.5 million on new acquisitions during 2017.

The Socimi currently manages 57 real estate assets through which fuel distribution activities are carried out, and it owns one hotel and one industrial warehouse for rent.

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Kingbook Injects €22M to Offset Losses & Buy New Assets

29 November 2017 – Eje Prime

Kingbook is reorienting its financial situation. The Socimi, which specialises in gas stations, has announced a capital increase amounting to €21.6 million to offset its losses, according to explanations provided by the company. The company, which is owned by GL Europe Reit, which owns a 60% stake, and JZ Real Estate, with a 40% stake, will use this capital injection to eliminate a considerable part of its current liabilities and to increase its own funds.

According to the information document prepared by Kingbook, “the purpose of this increase is to resolve the company’s equity imbalance”. This increase has been subscribed by Holdreit in its entirety, the company’s sole shareholder. On 11 July, the company decided to increase its share capital by €4.52 million, through the issue and launch into circulation of 4.52 million new shares with a nominal value of €1, through the offsetting of credits, with an issue premium that amounted to €17.1 million in total. At present, “the company is waiting for final approval from the Alternative Investment Market (MAB) before its share price reflects the increase in value resulting from the capital increase, which should happen within the next few days”, according to the group.

The report also highlights that the Socimi has incurred losses since it started operating. As at 30 September 2017, the result for the year was negative, with losses of €1.25 million. The group has seen its losses increase, given that during the same period last year, it made a loss of €767,390. “Following this move, the company’s equity position has been restored, with own funds of €23.3 million”.

Nevertheless, Kingbook has a solid portfolio of assets to continue operating for the next few years, which it has managed to increase by 21.5% over the last year, to €38.9 million. The company owns land worth €10.3 million and buildings worth €20 million, compared with €16.3 million a year ago.

Moreover, in the last year, Kingbook has added more than a dozen gas stations to its real estate portfolio. The company has acquired gas stations in León, in San Andrés de Rabanedo, for €900,000; in Cantabria, in Castro Urdiales, for €1.4 million; and in Burgos, in Miranda del Ebro, for €2.3 million, amongst others. Kingbook has spent €7.5 million on new acquisitions in total so far this year.

Moreover, the company announced in October that it is in the process of expanding its asset portfolio into other business areas besides gas stations.

Although the group explained that it has achieved high levels of efficiency in the management of its portfolio thanks to its specialisation, it has indicated that it does not want to limit its activity to a niche as specific as gas stations, given that it considers that “it has the financial potential and management resources to venture into other areas and to achieve competitive returns”.

In terms of the new business areas that Kingbook is exploring to incorporate into its portfolio, potential assets include parking lots and other infrastructure linked to the world of transport.

The Socimi currently manages 57 real estate assets where fuel distribution activities are carried out (gas stations) and also owns one hotel and one industrial warehouse (…).

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake