Colonial Will Increase its Share Capital by €180M to Finance Merger with Axiare

21 April 2018 – Expansión

The merger between Colonial and Axiare is moving ahead. The Socimi chaired by Juan José Brugera is expected to approve a capital increase at its next General Shareholders’ Meeting, scheduled for 24 May, to absorb the 13% stake in Axiare that it does not control yet. The capital increase will take place through the issue of 19.27 million new shares, which at current prices corresponds to a monetary value of around €181 million.

On 10 April 2018, the Boards of Directors of Colonial and Axiare approved the project to merge the two Socimis, which will give rise to a real estate giant with a portfolio of assets worth around €11 billion, which will place the new group very close to its rival Merlin, with assets of €11.254 billion.

This operation will go ahead after Colonial successfully completed its takeover of Axiare in February to acquire 87% of its share capital. The operation will involve the termination due to dissolution of Axiare and the block transfer of the Socimi’s assets to Colonial.

According to the approved exchange ratio, each existing shareholder of Axiare will receive 1.8554 shares in Colonial. To this end, the Catalan real estate company will submit to a vote by its shareholders the issue of a maximum of 19.27 million new ordinary shares with a nominal value of €2.50 each to pay for the merger exchange.

This operation will also be subject to a vote by the shareholders of Axiare, whose General Meeting is due to be held on 25 May on the first call and on 28 May on the second call, if the necessary quorum is not reached on the first call.

New Board

The items on the agenda for that General Shareholders’ Meeting include the appointment of Javier López Casado as a proprietary director, as a representative of Finaccess, which will then have two representatives on the Board after taking control of 18% of the group’s share capital. In this way, Axiare’s most senior governance body will comprise 11 members: four independent directors, two executive directors and five proprietary directors – two to represent the sovereign fund of Qatar, two to represent Finaccess and one to represent the Colombian firm Santo Domingo-.

On the other hand, Colonial is going to approve the distribution of a dividend amounting to €0.18 per share, up by 9%. The company is thus going to increase the remuneration to its investors with a third dividend payment after recovering it in 2016, following ten years of not paying the shareholders anything.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Finaccess Increases its Stake in Colonial to 18.23%

2 December 2017 – Expansión

The Mexican group Finaccess has reaffirmed its commitment to Colonial by investing another €154 million in the real estate company, which sees its total stake increase to €630 million based on the current market value. Following this acquisition, the group chaired by Carlos Fernández has increased its stake in the real estate company from 13.76% to 18.23% and has whereby retained its position as the company’s largest shareholder.

The operation forms part of the accelerated capital increase that Colonial carried out last week to raise financing for its takeover of Axiare.

Finaccess first acquired a stake in Colonial in the summer of 2016 through an operation that saw it exchange buildings for shares in the company. Since then, the Mexican firm has increased its stake in the real estate company on several occasions.

In addition to the Mexican company, the other two main shareholders of Colonial have also announced their commitment to support the group’s capital increase, up to a total of €250 million, which is why, following the purchase of Finaccess, there will be only €100 million left to raise. After Finaccess, the next largest stakes are held by the Qatar sovereign fund, which currently holds a 10.6% stake, and the Santo Domingo group, with a 7.3% stake. The Puig family, with a 5%, has declined to comment.

On Tuesday, Colonial closed a free capital increase that, together with the placement of its treasury shares, allowed it to raise €416.23 million. The operation followed the issue of €800 million in bonds placed last week. The two operations will contribute a total of €1.216 billion, compared with the €1.033 billion required. Colonial saw its share price close at €8 on Friday, after rising by 0.79% during trading.

Original story: Expansión (by M. Anglés)

Translation: Carmel Drake

Grupo Villar Mir Sells Final 1.51% Stake In Colonial

10 July 2017 – El Mundo

Grupo Villar Mir has definitively exited the share capital of the real estate company Colonial by selling the 1.51% stake that it still owned in the Socimi. The shareholding that has been sold is worth around €40 million on the basis of current market prices.

The corporation owned by Juan Miguel Villar Mir has thereby brought to an end its phase as a shareholder of the real estate company, which began in January 2014 – at its height, the Group was the largest shareholder, with a 24% stake. Villar Mir first invested in the real estate company Colonial when that firm was in the middle of its restructuring and clean up process, and it has exited it days after the firm returned to the Ibex 35 and became a Socimi.

Specifically, the corporation has sold the 5.42 million shares that it still owned directly in the real estate firm, through Espacio Activos Financieros, a package equivalent to a 1.51% stake of its share capital, according to the registers of Spain’s National Securities and Exchange Commission (CNMV).

Grupo Villar Mir also owned another 3.21% of Colonial indirectly, through various financial instruments. Those shares have been “loaned to hedge a financial operation”, according to the supervisor’s register.

In this way, the corporation concludes just over three years as a shareholder of Colonial, after leaving the Board of Directors in December 2016, when it decreased its stake in the company to just 3.3%.

Subsequently, in January 2017, it decreased its percentage to 1.5%, which is the stake that it is now selling.

Finaccess, current largest shareholder

Currently, the Mexican group Finaccess is the largest shareholder of Colonial; following its recent share purchase, it now owns 13.76% of the share capital. The Qatar sovereign fund is the second largest shareholder of the company chaired by Juan José Brugera, with a stake of 11.7%. The next largest shareholders are the Colombian firm Santo Domingo (6.1%) and the Puig family, which recently acquired a 5.10% stake.

On 19 June 2017, Colonial returned to the Madrid Stock Exchange’s Ibex 35, nine years after leaving the exclusive group. The firm owns a portfolio of office buildings for rent in the centre of Madrid, Barcelona and Paris, with a combined surface area of 866,000 m2 and a value of around €8,000 million.

With its return to the Ibex, Colonial completed the restructuring and clean-up process that it began in 2015. After that, it undertook a growth strategy through which it has now made investments amounting to €1,760 million through various operations, ranging from the purchase of assets to increasing its stake in its French subsidiary Société Foncière Lyonnaise (SFL), and acquiring capital in another Socimi, Axiare.

Original story: El Mundo

Translation: Carmel Drake

The RE Sector Attracts Overseas Investors Once More

12 April 2016 – Cinco Días

(…) Overseas capital is focusing on the property market once again. And Spain is one of the main European markets for offices, hotels and logistics. Madrid and Barcelona are leading the charge and the Socimis at the forefront of the revitalisation of the market. (…)

According to data from the Foreign Investment Register, published by the Ministry of Finance, the construction sector and real estate-related activities secured almost €7,700 million of direct foreign investment in 2015, i.e. 34.5% of the total. As such, one out of every three euros of international funds received by the Spanish economy last year was invested in the property sector.

Productive foreign investment (that which generates activity and employment) grew for the third consecutive year, to close 2015 with an increase of 11%, to €21,724 million. Of that amount, €4,706 million, i.e. 21.7%, was allocated to the construction of residential buildings and property development, compared with €1,762 million in 2014….Meanwhile, real estate-related activities (sales, purchases and rentals) accounted for 13.8% of the total, i.e. €2,992 million. (…).

In the context of this new activity, the Socimis have emerged as the main supporters of the market. The large Socimis experienced a real boom in 2015, when they flooded the MAB with their stock exchange debuts and came close to tripling their profits, which rose from €89.5 million in 2014 to €251.2 million last year, according to data from the CNMV.

Within the last year, the four largest Socimis (Merlin Properties – which has been listed on the Ibex 35 since December -, Hispania – thanks to its partnership with Barceló -, Lar España and Axiare Patrimonio) have doubled the value of the properties they own, to more than €9,200 million in total. (…).

The Socimis accounted for 41% of all funds invested in the purchase of real estate assets in 2015 – they spent €5,237 million on asset transactions. In this way, the increase in the volume of their investments amounted to 129%, in particular due to Merlin’s purchase of Testa for almost €1,800 million.

Wealthy individuals and several international funds have invested fully in these investment vehicles, attracted by the low prices in the sector and the tax advantages on offer (Socimis are exempt from paying corporation tax). The Qatar sovereign fund is trying to become the largest shareholder in Colonial; it now owns almost 30% of the Catalan real estate company.

George Soros has strengthened his commitment to Hispania, in which the millionaire John Paulson holds a stake of almost 10%. Carlos Slim controls Realia…Amancio Ortega, with his investment arm Pontegadea, now manages a very interesting and diverse asset portfolio.

The experts agree that the sector has left behind the turbulent times that it experienced following the burst of the real estate bubble. It is undergoing a period of normalisation and stabilisation – albeit a long way from its pre-crisis levels – and it is facing a new environment, with sustainable growth, in a market that is more mature and more professional.

Original story: Cinco Días (by Pablo Pico)

Translation: Carmel Drake

Joseph Lewis Increases His Stake In Colonial To 5.08%

16 September 2015 – El Mundo

The English businessman Joseph Lewis has increased his shareholding in Colonial from 3% to 5.08% and so his stake is now worth €91.3 million on the basis of the company’s current market price.

Lewis increased his stake in the real estate company to more than 5% on 10 September 2015, i.e. on the day after Grupo Villar Mir put 10% of the share capital it owned in the real estate company up for sale, according to the records of Spain’s National Securities and Exchange Commission (CNMV).

Specifically, the British investor acquired 66.13 million shares in Colonial, representing 2% of its share capital, worth around €37 million. Following this investment, Lewis owns 162.16 million shares in the real estate company in total, which represents a 5.08% stake.

The business tycoon hereby strengthened his position as a shareholder of the real estate company, in which he first acquired a stake in January 2015. Grupo Villar Mir continues to be Colonial’s largest shareholder, with 14.5% of the share capital.

Amongst Colonial’s other important shareholders are the Qatar sovereign fund, with a 13.3% stake; the Andorran bank MoraBanc with 7%; the Colombian group Santo Domingo (6.8%) and several other investment funds, whose stakes range between 1.9% and 5%.

The real estate company closed trading on Monday with more losses, making it the third consecutive day of decreases since 9 September, when at the close of business, Villar Mir announced its divestment, for €0.56 per share.

During the first trading session of the week, the company’s value decreased by 1.75%, taking its share price to €0.563, in line with that selling price.

Original story: El Mundo

Translation: Carmel Drake