Tag: share capital

Hispania And Barceló Create A Resort Hotel Socimi

25 February 2015 – Hispania Press Release

Hispania and Barceló create a resort hotel Socimi (REIT) with 16 hotels and an initial targeted investment of 421 million euro.

The first investment will be the acquisition of 3,946 keys (11 hotels and 1 shopping centre) plus the option to acquire additional assets reaching more than 6,000 keys (16 hotels) and 2 shopping centres currently owned by Grupo Barceló

Hispania will invest 339 million euro for an 80.5% stake in the new company, which will become a subsidiary of Hispania

The new REIT will be the first hotel REIT exclusively focused on holiday resort, targeting a minimum of 12,000 keys in Spain

Hispania Activos Inmobiliarios, S.A. has communicated to the Spanish Stock Market Regulator, CNMV, that its subsidiary Hispania Real SOCIMI, S.A.U, (hereinafter “Hispania”) has signed an agreement with Grupo Barceló (hereinafter, Barceló) for the creation of the first hotel REIT focused on the holiday resort segment; an industry in which Spain is one of the leaders worldwide.

Part of this agreement includes the acquisition by Hispania in an initial phase of 11 hotels (3,946 keys) and 1 shopping centre. Later on, Hispania will have the option to acquire 5 additional hotels (2,151 keys) along with a second shopping centre. The agreement is subject to the successful completion of the due diligence process.

Once the transaction is completed and the option on the 5 additional hotels executed, Hispania will have invested 339 million euro, obtaining an 80.5% stake in the new REIT. Grupo Barceló will maintain 19.5% with the option to reach up to 49% through future capital increases.

Barceló will remain as the operator of the acquired hotels through lease contracts with an initial term of 15 years.

The valuation of the 16 hotels and 2 shopping centres amounts to 421 million euro. It is expected that the REIT, following the execution of the option, will have an initial equity of 187 million euro and a syndicated loan amounting to 234 million euro. Hispania’s capital contribution will amount to a maximum amount of 151 million euro (total attributable investment of 339 million euro).

The initial asset portfolio will have pro forma rental income of approximately 45 million euro (40 million euro pro forma 2014).

The Barceló assets included in this agreement comprise most of its resort portfolio in Spain, located in the Canary Islands, Andalusia and the Balearic Islands; touristic destinations which have had a strong performance during the last few years and are expected to continue consolidating their position in the future. Out of the 16 hotels, more than 90% of the rooms available are 4* category and are leaders in their respective influence areas.

Hispania and Barceló have agreed to invest together an additional 35 million euro in the short term in order to complete the repositioning and updating of some of the properties.

“Spain is the third most important touristic destination in the world, preceded only by France and the United States”, commented Concha Osácar, Board Member of Hispania. “Spain has almost twice the number of resort keys than the United States, as well as a well-diversified tourist base, with British, German and French visitors representing more than 50% of the total. This illustrates the opportunities which the industry offers in Spain”.

The agreement signed between Hispania and Barceló will allow them to start an ambitious plan focused on increasing the portfolio of the new REIT, through hotel acquisitions or incorporations of existing hotels. The purpose is at least, to duplicate the size of the initial portfolio, creating a Spanish resort portfolio managed by different leading hotel operators.

According to Concha Osácar, “our objective and that of our partner Barceló, is that the new entity becomes the first listed REIT focused solely on hotel resorts, with a diversified portfolio in terms of hotel operators, and a steady income base, through lease contracts with a strong fixed income component and enough exposure to the future increase of the Spanish tourism market. The objective of the new REIT for Hispania and Barceló, is to become an instrument with which to attract institutional capital for the Spanish hotel industry, creating new sources of capital for the hotel industry”.

From Barceló’s perspective, “as a result of this transaction, we are creating a solid alliance with one of the most active investors in the industry”. According to Barceló’s CEO, Raúl González, “after this transaction we will be in leading position to benefit from the concentration process that should take place in the Spanish hotel industry”.

Hispania has invested a total of 112 million euros, including capex for 2015, in 6 hotels (5 acquired in 2014 and 1 in 2015) managed by different hotel operators (Meliá, NH and Vincci), which could be included into the new REIT; this decision will be made by the partners during the second half of 2015.

Hispania will have invested 100% of the net proceeds raised

With this agreement, Hispania will have committed a total investment of c. 800 million euros in a total of 44 assets since its IPO on 14 March 2014.

Original press release: Hispania

Edited by: Carmel Drake

CNMC Authorises Santander’s Purchase Of Bankia’s 19% Stake In Metrovacesa

13 February 2015 – Expansión

With this purchase, Santander will assume ownership of 55.8% of the share capital, whereby taking control of the real estate company.

Santander has received authorisation from the National Markets and Competition Commission (Comisión Nacional de los Mercados y la Competencia or CNMC) to purchase Bankia’s 19% stake in Metrovacesa and whereby assume control of the property company, by taking ownership of 55.8% of its share capital.

The ‘super regulator’ has authorised the first phase of the operation, which is not deemed to generate any competition concerns, according to the records of the body.

At the beginning of December, Santander agreed to buy the 19% stake that Bankia, the nationalised bank, holds in Metrovacesa for €100 million.

Thus, by virtue of the transaction, the bank chaired by Ana Patricia Botín takes control of the real estate company and Bankia fulfils a new milestone in its plan to divest its industrial holdings, and also records a profit of €13 million as a result.

After Santander, the other shareholders in Metrovacesa are BBVA, with an 18.3% stake, Banco Sabadell (13%) and Banco Popular (12.6%).

The Sanahuja family

The company has been controlled by the aforementioned financial institutions since February 2009, when they foreclosed the debt held by the Sanahuja family, the then controlling shareholder of the company.

For Metrovacesa, which was delisted from the stock exchange in May 2013, the takeover by Santander represents a new phase in its share ownership.

The real estate company, which was once controlled by BBVA, was acquired from that entity in 2004 through a takeover bid (oferta pública de adquisición or OPA) by Bami, the company owned by Joaquín Rivero. Subsequently, the company was the subject of a ‘takeover war’ between the businessman and the Sanahuja family, but eventually the banks took control.

Metrovacesa is dedicated to the rental of real estate assets. Its portfolio includes buildings covering more than 1.1 million square metres, comprising offices, shopping centres and hotels, which are mainly located in Madrid and Barcelona. Amongst others, it is the owner of the iconic Torre Madrid in Plaza de España in Madrid, which will soon house a hotel to be operated by the Barceló chain.

Original story: Expansión

Translation: Carmel Drake

Sacyr Seeks Investors To Inject €300m Into Testa

4 February 2015 – Expansión

Operation Accordion / The construction company will receive contributions from its subsidiary amounting to €1,180 million, as the preliminary step in the placement of up to 30% of its capital with institutional investors.

Yesterday, in a whirlwind shareholders meeting, Sacyr gave the go ahead for Testa, its real estate management company, to carry out a significant internal restructuring with the dual-objective of enabling it to pay multi-million debts to its parent and at the same time, strengthening its balance sheet from the inflow of funds through a capital increase on the stock market.

Specifically, Testa’s shareholders renewed the mandate to the Board of Directors (led by Fernando Lacadena, the new CEO, who replaced Daniel Loureda) to conduct an operation to return €1,197 million to its shareholders through an extraordinary dividend payment of €527 million and a reduction in capital of €669 million, within the next year.

Sacyr will be the main beneficiary since it controls 99.3% of Testa’s share capital. This operation is subject to a simultaneous capital increase, to allow Testa to reconstruct its balance sheet through an IPO, which has a minimum target of €300 million.

IPO

The two operations are closely linked, which is why Sacyr has taken its time to sound out the market and determine the level of investor interest in Testa. The intention of the group, chaired by Manuel Manrique, is to carry out a placement through an IPO aimed at institutional investors. In parallel, Sacyr also plans to divest some of its stake, although how much it will relinquish has still to be determined. In any case, the construction company wants to retain its role as the controlling shareholder, and so its stake after the sale will not fall below 70%.

(…)

Testa’s shares closed trading yesterday at €19.30 per share, after a strong rise of 7.3%. The company’s market capitalisation amounts to €2,230 million, which means that at current market prices, the sale of a 25% stake would generate income of €550 million.

In a second phase, Sacyr’s objective is to convert Testa into a Socimi (a real estate company that pays out 85% of its profits in dividends). This new type of company, which benefits from significant tax exemptions, has attracted interest from reputed investors such as George Soros, John Paulson and large funds, including Pimco.

For Testa, the new Socimi structure would have the advantage of starting out with a large, ready-made portfolio of assets, which generated turnover of more than €140 million during the first nine months of 2014.

According to the latest appraisal data published by the CNMV, the market value of Testa’s properties amounts to €3,287 million, which would make it the largest Socimi in the country by asset value. Currently, Merlin Properties is the largest Socimi, with assets valued at more than €1,276 million.

This year, we also expect to see the IPO of Bulwin, the Socimi created by the listed company Quabit. The historical real estate company GMP has also changed its structure to a Socimi.

Original story: Expansión (by C. Morán and R. Ruíz)

Translation: Carmel Drake

Sacyr Begins Relaunch Of Testa’s IPO To Raise €300m

3 February 2015 – Expansión

Testa, a company controlled by Sacyr, which owns 99.3% of its share capital, will hold the annual meeting of its shareholders today. It is expected that the mandate of the real estate company’s Board will be renewed to approve the distribution of extraordinary dividends and contributions to shareholders through a reduction in share capital. These measures are conditioned on the launch of Testa’s IPO, through which the company seeks to raise at least €300 million.

Specifically, Testa’s Board will give the green light to a capital reduction of €669 million and the return of a further €527 million to its parent company. Sacyr will receive €1,188 million from its subsidiary for both of these concepts.

Sacyr has engaged JP Morgan, Morgan Stanley and Garrigues to coordinate the IPO. Although the percentage stakes (of the new shareholders) have not been fixed, the entry of new shareholders (which will dilute the current ownership structure) will be limited to a maximum of 30% of the capital, since Sacyr wants to retain its position as the controlling shareholder, with a stake of more than 70%. The banks tried to launch this transaction last year, but market conditions prevented it from going ahead.

The company will try again in 2015, at a time when companies have turned their gaze back to the stock market as a means of financing their businesses and growth plans. Currently, around twenty companies in Europe are looking to go public. In Spain, notable placements include those by Aena, Saeta Yield (ACS), Abertis Telecom and Talgo, amongst others.

Testa’s shares closed trading yesterday flat at €18 per share, representing a market capitalisation of €2,078 million. At this market price, the sale of 25% of Testa’s capital would generate revenues of €500 million.

The subsidiary is the jewel in Sacyr’s crown. It is one of the leading companies in its sector by market assets, with a leasable surface area of 1.37 million square metres and an occupancy rate of 97%.

Original story: Expansión (by C. M.)

Translation: Carmel Drake