Uro Properties Sells 14 Santander Branches for €29.5M

6 September 2018 – Eje Prime

Uro Properties is doing business with Lerma Investments. The Socimi, one of the investment vehicles that owns some of Santander’s branches, has sold fourteen of the financial institution’s branches to the company Lerma Investments for €29.5 million, according to a statement filed by the group with the Alternative Investment Market (MAB).

The assets are currently leased to Banco Santander for an average period of 21 years. Following this sale, Uro Properties will have liquidity of €44 million. Moreover, the Socimi will continue to own a portfolio of bank branches with a market value of more than €1.88 billion.

Uro Properties debuted on the MAB in March 2015 at a price of €100 per share and with a market value of almost €260 million. Three years later, its market capitalisation amounts to €206.9 million. The reference shareholders in the company are the firm Ziloti Holdings and Banco Santander itself, which owns 15% of the share capital directly.

Currently, the Socimi’s portfolio comprises 712 properties, which occupy a surface area of more than 330,000 m2. More than half of those assets are located in Madrid, Cataluña and Andalucía.

Original story: Eje Prime 

Translation: Carmel Drake

Uro Property Debuts On MAB With An Increase Of 5%

13 March 2015 – Expansión

Uro Property, the Socimi that owns one third of Santander’s bank branches and whose main shareholders are Santander, Atisha and CaixaBank, debuted on the Alternative Investment Market (Mercado Alternativo Bursátil or MAB) yesterday with an increase of 5.05%, to take its price per share to €105.05.

The company is being listed through a fixing procedure, whereby its prices are published twice a day (at 12:00 and at 16:00). At 12:00, when the shares debuted, the price increased to €102.50, i.e. by 2.5% with respect to the price of €100 that had been set for its IPO. Its price at 16:00 (the official price for the session) reached €105.05.

Thus, Uro Property ended the day with a market capitalisation of €272 million and so became the largest company trading on the MAB.

Original story: Expansion

Translation: Carmel Drake

Santander To List 2% Of Its Socimi And Whereby Avoid CIT

6 February 2015 – El Confidencial

Desperate times call for desperate measures. That is the proverb that Banco Santander is going to apply to a problem that has arisen after it sold a network of 1,152 bank branches bearing the red flame to a group of investment funds in 2007. The entity, which had to take the branches back when the investment company that had taken ownership of them filed for bankruptcy, is going to float that company on the stock exchange as a Socimi, and whereby avoid paying Corporation Tax. Oleguer Pujol, amongst others, was involved with the original investment company.

The main objective of the transaction that Santander and the other creditors that seized control of Samos Servicios for the non-payment of a €2,000 million loan is to float the newly named Uro Properties on the Alternative Investment Market (Mercado Alternativo Bursátil or MAB). In fact, none of the current shareholders, which includes Santander itself – the largest, with a stake of almost 25% – as well as Caixabank, which entered through the back door and BNP Paribas, all primary lenders, are planning to sell or reduce their stakes in the Socimi.

The transaction will involve listing the company with the placement of a maximum of 2% of its capital, the minimum requirement. With such a small amount of floating capital or free floating capital, Uro Properties is only allowed to list on the MAB, even though its total assets are worth €1,600 million. As such, it will become the largest real estate company on the Spanish stock market. None of the other Socimis that followed the same path in 2013, such as Hispania, Lar, Axia or Merlin Properties, are equal in size.

Since the shareholders are not going to sell their old shares or proceed to offer new ones, like the other Socimis mentioned above have done, the only apparent purpose for listing Uro Properties is to benefit from the tax regimes offered to these kinds of companies. According to Law 11/2009, dated 29 October 2009, these real estate companies pay Corporation Tax at a rate of 0%.

To maximise the tax savings even further, the shareholders of Uro Properties Holding SA have created a parent company in Luxembourg, under the name Ziloti Holding SARL. The shareholders have already asked the MAB for permission to list their shares, as soon as possible, specifically, before the end of February.

From success to failure

The background to Uro Properties dates back to 2007, when Emilio Botín invented a transaction, which other large multinationals later went onto to make fashionable in Spain: the sale of properties to investment funds to obtain sizeable gains in exchange for staying as tenants and paying rent. It is what is called sale and leaseback. The purchasers of Santander’s 1,152 branches were Pearl Insurance, Sun Capital and Drago Real Estate, which were advised by Oleguer Pujol, now accused of crimes against the Treasury, and Luis Iglesias, who was arrested after his home was search, but not charged, according to an official spokesman.

The three funds paid €2,040 million and Santander generated profits of €850 million. But the collapse in the valuation of the real estate assets themselves and the loss of the bank’s credit rating led to an adjustment in the appraisal value of the branches – which were guaranteeing the loan – of more than €400 million. This meant that the purchasers were no longer able to service the loans they had taken out to finance the purchase.

Following the bankruptcy of Samos Servicers, Santander, which had borne most of the financing risk by granting mezzanine debt, had to convert that loan into capital. This meant that it went from being a creditor of the company to a shareholder in the renamed Uro Properties. BNP Paribas, Caixabank, Société General, Royal Bank of Scotland, Barclays and a group of German and Austrian banks, including Bayerische and Raiffessen, did the same thing.

Original story: El Confidencial (by Agustín Marco)

Translation: Carmel Drake