Tag: major shareholders

Metrovacesa Creates RE Developer With Assets Worth €1,040M

27 November 2015 – Expansión

The real estate company Metrovacesa, controlled by Santander (owner of 72.5% of the share capital), BBVA (19.4%) and Popular (7.9%) is going to be divided into two companies.

The historical real estate company has announced a demerger project, which was approved by the Board of Directors on 24 November and which will be presented to the ordinary shareholders’ meeting for approval on 29 December.

The project includes the creation of a new company into which Metrovacesa will place its land and home development businesses; meanwhile, the existing company will continue to hold the properties linked to its real estate business, in other words, the offices, shopping centres and homes that generate rental income. “We are looking to carry out a business restructuring process to add value to the company, as well as a potential refinancing of our financial liabilities, to ensure the feasibility and profitability of the businesses in the future, by separating out the property business from the land and home development businesses”, explains the company.

The new company, called ‘Metrovacesa Suelo y Promoción’, will be 100% owned by the current shareholders of the real estate company, in “exactly the same proportion as their existing stakes in Metrovacesa”. The company led by Rodrigo Echenique will create a new company with assets worth more than €1,040 million. “The new company will issue 3,075 million new shares, with a nominal value of €0.16 – a total share capital of €492 million – with a premium of €547.8 million, taking the total value to €1,039.85 million”.

Three capital increases

To create the new company, the Board will propose three successive capital increases to its shareholders. The first one will be non-cash and will involve “specific major shareholders”, which will contribute “assets that will form part of the company’s equity”. The second will involve the capitalisation of financial loans, leaving the new company with hardly any debt; and the third will take place to ensure that there is no dilution of the minority shareholders’ stakes. “In the event that the capital increases are fully subscribed, Metrovacesa’s share capital would amount to €1,261 million”.

Following the demerger, the real estate company will have share capital amounting to €769 million, in other words, around 61% of its current value, and the remaining 39% will be transferred to the new company. The real estate company indicates that its indebtedness is associated “primarily” with its property business and a “significant” portion of it is due to mature in Q3 2016, which it will be able to refinance more effectively following the execution of this process.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Metrovacesa To Capitalise €730M To Reduce Its Debt

6 April 2015 – Expansión

Metrovacesa is continuing its debt reduction process. After generating income of €1,546 million from (the sale of) its 27% stake in Gecina last summer, the real estate company will propose a capital increase of almost €730 million at its next shareholders’ meeting.

The aim of the capital increase is to convert some of the group’s liabilities into shares, according to an announcement made by the real estate company regarding the agenda for its general shareholders’ meeting. At the meeting, which will take place on 28 April at its headquarters in Las Tablas (Madrid), the leaders of the real estate company will present the results for 2014. In 2013, the most recent year for which figures have been presented, Metrovacesa recorded losses of €349 million, i.e. 29% more than in the previous year.

In that year, the group’s financial debt exceeded €5,088 million, a liability that it has managed to reduce following the sale of its stake in the French real estate company Gecina. In June, Metrovacesa agreed the sale of its 26.7% stake in the French company to Norges Bank, Crédit Agricole, Blackstone and Ivanhoe Cambridge for €1,546 million. These funds were mainly used to repay a syndicated loan amounting to €1,600 million.

The debt for equity exchange will be accompanied by a capital increase through a cash contribution, with preferential subscription rights. The objective is to allow the 4,000 smaller shareholders to maintain their minority stakes, if they so wish, without any dilution of their ownership.

The main shareholder of Metrovacesa is the Santander group. The financial entity holds 55.8% of the (real estate company’s) capital, after it acquired the 19% stake that Bankia held in December (2014). Santander paid €100 million in that transaction.

The bank, chaired by Ana Botín, first invested in Metrovacesa’s share capital in 2008, when the real estate company was unable to pay its debts to its then largest shareholder, Román Sanahuja. Other banks also participated in that transaction (and still hold stakes today), namely: BBVA, which holds a 18.31% stake; Sabadell, which holds a 13.04% stake; and Popular, which owns 12.64%.

In 2013, these entities approved the de-listing of the real estate company from the stock exchange and, since then, they have focused on restructuring the debt.

New directors

At the shareholders’ meeting, Metrovacesa will also propose the appointment of four new directors: Rodrigo Echenique, Vice-President and Executive Director of Santander; Abel Matutes, Chairman of the Matutues business group; Juan Ignacio Ruiz de Alda, Director at Santander; and Manuel Castro; Director of Global Risk Management at BBVA.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake