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Stenprop announces disposal of several Swiss properties

Paul Arenson, CEO of Stenprop.
Paul Arenson, CEO of Stenprop.

Stenprop’s shareholders are advised that the group completed the disposal of two of its Swiss properties, Altendorf and Arllesheim on the 17th of July 2018, via the sale of the entire issued share capital of Polo Property GmBH, a wholly-owned indirect subsidiary of Stenprop, to Helvetica Swiss Commercial AG, a wholly owned subsidiary of Helvetica Swiss Commercial Fund, a real estate fund focused on Swiss property regulated by the Swiss Financial Market Supervisory Authority FINMA and managed by Helvetica Property Investors AG, Zurich, licensed and regulated by FINMA as its Fund Manager Swiss fund. 

Shareholders are further advised that three subsidiaries of Stenprop also entered into agreements for the disposal of five additional Swiss properties, being Baar, Vevey, Montreux, Chiasso and Sissach, as asset sales to the Purchaser. The aggregate consideration for these disposals is CHF76.35 million (£58.731 million) to be settled in cash. The combined transactions value the seven properties at CHF103.65 million (£79.73 million) compared with the valuation at 31 March 2018 of CHF103.23 million (£79.41 million).

Stenprop has previously announced its intention to become a specialised UK multi-let industrial REIT and, over the next few years, to sell substantially all of its non-multi-let assets and utilise the sale proceeds to build a focused UK multi-let business. It has also previously announced its intention to dispose of its Swiss portfolio in line with this strategy.

The sale and purchase agreement for the disposal of Polo Property was signed and simultaneously closed on 17 July 2018. The asset disposals of Baar, Vevey, Montreux, Chiasso and Sissach are subject to individual and separate sale and purchase agreements. The Vevey and Montreux SPAs closed on 18 July 2018. The Baar and Sissach SPAs became unconditional on 18 July and are expected to close on 19 July 2018 or shortly thereafter.

The Chiasso SPA remains subject to the release of security by the lender, and is expected to become unconditional and close shortly. Failure to close before 30 September 2018 will result in termination of the Chiasso SPA. The total consideration for Baar, Vevey, Montreux, and Sissach is CHF57.55 million (£44.27 million). The consideration for Chiasso is CHF9.40 million (£7.23 million). The total consideration for the shares in Polo Property is CHF9.40 million (£7.23 million), which is subject to a potential post-completion adjustment based on Polo Property’s audited financial statements at 30 June 2018.

Stenprop has provided a surety undertaking for the obligations of its subsidiaries under the Polo SPA and the SPAs, limited to a total value of CHF6 million (£4.6 million). Normal warranties and indemnities for transactions of this nature have been provided by the relevant subsidiaries of Stenprop.

The value attributable to the properties was determined in accordance with Royal Institution of Chartered Surveyors standards by Roger Meeds, a director of Jones Lang LaSalle Limited, who is an external valuer registered with the Royal Institution of Chartered Surveyors. These valuations were reflected in Stenprop’s consolidated statement of financial position at 31 March 2018.

The combined transactions are classified as a category 2 transaction in terms of the JSE Listings Requirements. Accordingly, it is not subject to approval by shareholders. Stenprop was advised by CBRE Switzerland, McCafferty Asset Management AG and Walder Wyss Ltd.