Secure Property Dev & Inv PLC Profitable Sale of Ukrainian Warehouse (9980M)
October 20 2016 - 2:00AM
UK Regulatory
TIDMSPDI
RNS Number : 9980M
Secure Property Dev & Inv PLC
20 October 2016
Secure Property Development & Invest PLC/ Index: AIM / Epic:
SPDI / Sector: Real Estate
20 October 2016
Secure Property Development & Investment PLC ('SPDI' or 'the
Company')
Profitable Sale of Ukrainian Warehouse
Secure Property Development and Investment PLC (AIM: SPDI), the
South Eastern European focused property and investment company, is
pleased to announce it has signed a Sale and Purchase Agreement
('SPA') with Temania Enterprises Ltd for the sale of its Terminal
Brovary warehouse in Kiev at a Gross Asset Value of over US$16
million (before the deduction of the outstanding EBRD loan - the
"Transaction"). This compares favourably to the US$13.4 million
gross value assigned to the Terminal as at 31 December 2015 and
will generate a net profit of over US$2.5million net to SPDI and a
net cash inflow of over US$3 million (see announcement of 9 June
2016 for further details). The Transaction (including payment) is
subject to final approval by the lender (EBRD) and the Ukrainian
Antimonopoly Commission which is expected to be received
shortly.
The Transaction is in line with the Company's plan to focus on
high-yielding South Eastern European countries such as Romania,
Bulgaria and Greece while limiting its exposure in Ukraine as both
the economy and the political stability in the country do not show
concrete signs of improvement. SPDI's strategy is to deliver value
to its shareholders from a portfolio of well located income
generating properties with blue chip tenants in high-yielding
locations that have favourable demand/supply dynamics for modern
commercial properties. Such properties still command low prices /
high income yields and has the potential for capital appreciation,
as yields converge towards the Central Eastern European, and
eventually to Western European levels. This strategy will be
boosted both by the cash received from the sale of Terminal Brovary
but also by more capital that is expected to be generated to make
further property asset acquisitions.
Following the conclusion of the Transaction, the Company's
income producing asset portfolio will include logistics terminals
in Athens and Bucharest, offices in Sofia and Bucharest, as well as
a big box retail in Craiova, Romania. In addition to the
residential unit portfolio in Bucharest and Sofia, SPDI continues
to hold sizeable land assets in Ukraine, all of which have
excellent locations and are debt free. SPDI is currently evaluating
various options to generate value from these assets.
SPDI CEO, Lambros Anagnostopoulos, commented, "This transaction
is in line with our strategy to generate value from our prime real
estate properties across South Eastern Europe, through both annual
cash inflows and profitable exits following cap rate convergence.
Terminal Brovary provides a readymade example of successfully
implementing such a strategy as it has been generating consistent
cash flows ever since the new management took over the Company,
completed the construction of the building and leased out the asset
at the end of 2012. Four years on we have successfully negotiated
its sale, which we believe is one of the largest property asset
transactions in Ukraine since 2014. The net proceeds, which will be
combined with additional capital we plan to generate, will go
towards acquiring more attractively valued prime real estate in
high growth countries such as Romania and Bulgaria, where we
continue to evaluate additional opportunities.
"Our aim is not only to expose our shareholders to the European
yield compression play and the significant capital appreciation on
offer, but also to generate substantial cash from managing our
portfolio of property assets. SPDI has both the locally based team
and the network of advisers to effect timely and successful
monetisation of assets in the countries we are active in when
opportunities to generate value for our shareholders are presented
to us. The profitable exit from Terminal Brovary is in line with
our objective as set by our Board of Directors to position
ourselves as the 'go to' investment vehicle for investors looking
to gain exposure to the region's highly attractive property
markets.
"At the same time, the value achieved highlights the large
discount and resulting disconnect that persists between the Net
Asset Value of our Company and our share price. We are determined
to close this disconnect so that SPDI's share price fully reflects
the real value of our Company's holdings."
* * ENDS * *
For further information please visit www.secure-property.eu or
contact:
Lambros Anagnostopoulos SPDI Tel: +30-210-7226470
Constantinos SPDI Tel: +30-210-7226470
Bitros Strand Hanson Limited Tel: +44 (0) 20
Andrew Emmott 7409 3494
Ritchie Balmer Strand Hanson Limited Tel: +44 (0) 20
7409 3494
Lottie Brocklehurst St Brides Partners Tel: +44 (0) 20
Ltd 7236 1177
Frank Buhagiar St Brides Partners Tel: +44 (0) 20
Ltd 7236 1177
This information is provided by RNS
The company news service from the London Stock Exchange
END
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