Atrium European Real Estate Limited

euro adhoc: Atrium European Real Estate Limited
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EQUITY FUND RAISING, RELATED ARRANGEMENTS AND LISTING PLANS

@@start.t1@@--------------------------------------------------------------------------------   Disclosure announcement transmitted by euro adhoc. The issuer is responsible   for the content of this announcement. --------------------------------------------------------------------------------@@end@@

14.01.2009

EQUITY FUND RAISING, RELATED ARRANGEMENTS AND LISTING PLANS

Jersey, January 14, 2009:  Atrium European Real Estate Limited ("Atrium" or  the

@@start.t2@@"Company") (ATX: ATR), one of the  leading  real  estate  companies  focused  on
shopping centre investment management and development  in  Central  and  Eastern
Europe, announces that it has agreed the terms of a new equity fund raising  and
related arrangements with Citi Property Investors and its investors ("CPI")  and
Gazit-Globe  Limited  ("Gazit"  and,  together,  the  "Investors").      The    new
agreement has  been  approved  by  a  committee  of  the  Company's  independent@@end@@

directors, chaired by Professor Peter Linneman and advised by Kempen & Co.

This equity fund raising and related arrangements will raise  EUR   72.1  million of new equity, reduce the Company's indebtedness by at least EUR 103 million  in principal  amount  and  significantly   reduce  the  equity    overhang    of    the outstanding warrants to subscribe for the Company's shares from  30  million  to approximately five million. The private placement and  other   arrangements  will replace the EUR 300 million rights issue that was proposed  to  follow  the  EUR 500 million investment in the Company made by the Investors in August  2008  and due to be completed by the end of January 2009.

The terms of the new equity fund raising  and  related  arrangements have  been agreed against a backdrop of a number of factors, including:

@@start.t3@@. The fact that the Company's  current  and  recent  share  price  makes  it
         unlikely that the certificate holders  would  subscribe  to  the  proposed
         rights issue at EUR 7 per share,  which  would  result  in  the  Investors
         subscribing to the entire  issue  and  causing  considerable  dilution  to
         existing certificate holders.

      . The letter the  Company  recently  received  from  the  Austrian  Takeover
         Commission  ("ATC")  regarding  its  proposed    investigation    into    the
         application of the Austrian Takeover Act to the Company during the  period
         of its management by Meinl European Real Estate Limited.  This created  an
         uncertainty that in fully subscribing a EUR 300 million rights issue under
         their backstop commitment, the Investors might have been required to  make
         a mandatory bid for the Company, which was never the intended result.

      . Following an assessment of the Company's  development  pipeline,  Atrium's
         management believes that the Company has  sufficient  cash  to  cover  its
         current requirements.@@end@@

Details of the new equity fund raising and related arrangements are as follows:

@@start.t4@@. The Company will issue 10,300,000 new ordinary shares in  aggregate  at  a
         price of EUR 7 per share.  CPI will acquire  4,738,000  shares  and  Gazit
         will acquire 5,562,000 shares with the subscription amount being  paid  at
         the option of each Investor either in cash  or  by  the  transfer  to  the
         Company of convertible bonds issued to the Investors  by  the  Company  on
         August 1, 2008 in a principal amount equal to its respective  subscription
         amount.

      . The Investors will deliver 25,066,667 existing warrants to  subscribe  for
         ordinary shares (out of a total of 30 million such warrants issued to  the
         Investors on August 1, 2008) to the Company. They will  be  cancelled  for
         nil  consideration,  removing  the  potential  dilutive  effect  of  those
         warrants.  No additional warrants will  be  issued  to  the  Investors  in
         relation to their subscription for 10,300,000 new ordinary shares.

      . Conditional on closing of the subscription  for  the  new  shares  by  the
         Investors, the Company will acquire from Gazit around  EUR  103million  in
         principal amount of the Company's 2006  listed  medium  term  notes  (ISIN
         XS0263871328).  The notes have been acquired by Gazit in market  purchases
         over the past year and prior to  the  Company's  buyback  programme  at  a
         variety of prices and shall be acquired by the Company for a  cash  amount
         equal to the aggregate of the prices paid for  them  in  the  open  market
         (including  dealing  costs)  by    Gazit    (which in    aggregate    is    EUR
         77.26 million) plus accrued interest on the notes to the date of  purchase
         by the Company.

      . The Investors have deposited certain of the Company's debt securities with
         the Company as security in respect of their obligation  to  subscribe  for
         the new shares.  The Investors' security deposit covers  their  commitment
         to subscribe for the new shares in full.

      . Completion of the subscription for the new shares will take place no later
         than January 31, 2009.

The new equity fund raising and related  arrangements  provide  Atrium,  in  the@@end@@

face of difficult and unpredictable markets, with swift  and  certain execution of a transaction that should improve Atrium's  balance   sheet  by  reducing  the amount of the Company's indebtedness  and   at  the  same  time  remove  a  large portion of the potential dilutive effect of the Company's warrants.

Depending  on  the  form  of  the  consideration  paid,  as  a   result  of    the subscription for the new shares, the Investors  and their  affiliates  will  in aggregate be interested in securities of the Company carrying between  27.9  per cent. and 29.96 per cent. of the  Company's  outstanding  voting  rights.    This compares against a possible total interest of 37.26 per cent. by  Investors  and their affiliates under the previously proposed rights issue.[1]

In addition, the Company and the Investors have agreed to the following:

@@start.t5@@. The Company will seek a  listing  for  its  ordinary  shares  on  Euronext
         Amsterdam by July 31, 2009 in conjunction with which it will seek to  list
         its ordinary shares on the Vienna Stock Exchange in substitution  for  the
         listing of the certificates representing its ordinary shares  as  detailed
         in the announcement made on November 13, 2008.

      . The Investors will not acquire additional shares or voting rights  in  the
         Company, nor exercise any of their warrants,  such  that  their  aggregate
         interest in the Company's voting rights would exceed 30 per  cent.  before
         the earlier of August 1, 2009 or the ATC confirming that the mandatory bid
         requirements contained in the Austrian Takeover Law are not applicable  to
         the Company.

      . The Investors will  not  dispose  of  the  10.3  million  ordinary  shares
         acquired by them in the equity fund raising before the earlier  of  August
         1, 2009 or the Company's listing on Euronext Amsterdam.

      . The Investors will not,  without  the  consent  of  the  Company,  acquire
         securities of the Company before August  1,  2010  that  would  trigger  a
         change of control as defined in the Company's 2006 bonds, so  long  as  at
         least EUR 180 million (face value) of the bonds remain outstanding.

      . The Investors have agreed to waive any warranty and certain  other  claims
         that they may have  against  the  Company  under  the  master  transaction
         agreement among the Investors and the Company dated March 20, 2008.

      . The Company has  confirmed  to  the  Investors  that  it  has  no  current
         intention of acquiring its own shares pursuant to the authority granted by
         shareholders at the  extraordinary  general  meeting  of  Atrium  held  in
         December 2008.  However, Atrium reserves the right  to  request  that  the
         Investors permit the Company to make purchases of its own  shares  in  the
         future.    In  addition,  in  light  of  technical    Jersey    company    law
         requirements, in the event that the Investors decide to  pay  for  all  or
         some of the  new  shares  by  the  transfer  of  2008  convertible  bonds,
         shareholders will be asked to approve  the  cancellation  of  the  special
         voting shares related to those bonds and the Investors have agreed to vote
         in  favour  of  such  cancellation.    Prior  to  the    cancellation,    the
         transferors will agree not to vote the relevant special voting shares.@@end@@

Rationale for the transaction

The Company reached the decision to proceed with the  new  equity   fund  raising and related matters in place of the proposed rights issue by agreement with  the Investors, among other reasons, in light of the following factors:

@@start.t6@@. Following the unprecedented volatility and  significant  deterioration  in
         market conditions experienced globally since March  2008,  when  agreement
         was reached regarding Atrium's new management structure and the Investors'
         initial investment in Atrium and a rights issue was  first  proposed,  the
         Company's share price has declined from over EUR 7 per share to around EUR
         3 per share and reached a low of EUR 1.55 in November 2008.  As the rights
         issue price of EUR 7 per share is significantly above the  current  market
         share price, it is very unlikely that existing certificate  holders  would
         have taken up the opportunity to subscribe for new  shares  and  therefore
         Atrium would have  been  required  to  rely  on  the  undertaking  of  the
         Investors (which is unsecured) to back stop the rights issue,  potentially
         in full. That would have been significantly dilutive to the other existing
         certificate holders both in terms of their economic and voting  rights  in
         the Company.

      . An assessment conducted over recent months by Atrium's new  management  of
         the Company's existing development programme has resulted in a significant
         reduction in the Company's anticipated cash requirements  for  development
         purposes.  The Company has already used some surplus  cash  to  repurchase
         indebtedness in recent months and has the appetite to further  reduce  its
         indebtedness.  Rather than executing the proposed rights  issue  in  full,
         which would have required Atrium to issue a very significant number of new
         shares in return for a significant amount  of  additional  cash,  the  new
         equity fund raising and related arrangements have the benefits  to  Atrium
         of reducing the potential dilutive effect of subscription entitlements  on
         existing shareholders and achieving a better ratio of debt to  equity  for
         the Company.

      . Uncertainty has been created regarding the  application  of  the  Austrian
         Takeover Act to Atrium following a letter received by the Company from the
         Austrian Takeover Commission in late December 2008, in which the  Austrian
         Takeover Commission states that it is contemplating an investigation  into
         the application of the Austrian Takeover Act to  the  Company  during  the
         period of its  management  by  Meinl  European  Real  Estate  Limited  and
         requests a response from the Company by January 30,  2009.    While  Atrium
         does not believe that it is now subject to the Austrian Takeover Act,  the
         letter from the Austrian Takeover Commission has created  a  concern  that
         the back-stopping in full of a rights issue by the  Investors  might  have
         triggered an obligation under the Austrian Takeover Act on  the  Investors
         to make a mandatory cash bid for the remainder of the  Company's  ordinary
         shares. That  was  never  intended  as  a  consequence  of  the  back-stop
         obligation nor would it represent an appropriate outcome of  the  proposed
         rights issue.  Although the Company does not  agree  with  any  suggestion
         that the Austrian Takeover Act  should  now  impose  any  mandatory  offer
         requirement,  it  is  highly  unlikely  that  this  uncertainty  could  be
         satisfactorily resolved  by  a  determination  of  the  Austrian  Takeover
         Commission in enough time to launch and complete a rights issue before the
         end of January 2009.@@end@@

Atrium has received financial advice from Kempen & Co Corporate Finance B.V.  in relation to the new equity issuance  and  related   arrangements.    Decisions  in relation to the revised equity fund raising and related arrangements were  taken by a committee of the board of the Company consisting of the  six  directors  of Atrium who are independent of the Investors and excluding the four directors  of Atrium appointed by the Investors, who did not participate.

Commenting on the transaction, Rachel Lavine, chief  executive   officer  of  the Company said:  "Given the unprecedented continuing   uncertainty  and  volatility in the capital markets and the uncertainty  regarding  the  application  of  the Austrian Takeover Act, I am very pleased that  the  Company  has  been  able  to reach agreement  on  a  transaction  that  includes    an    appropriate     equity subscription  by  the  Investors  and  a  further  reduction   of  the  Company's outstanding indebtedness.    At  the  same  time   the  transaction  avoids  undue dilution of the Company's  other   shareholders.    I  believe  that  the  Company remains in a  strong   position  to  address  the  challenges  presented  by  the continuing turbulence in the real estate sector and I am  pleased  that  we  are now working towards a listing on  the  Euronext  market  in   Amsterdam  and  the associated benefits we believe that will bring for our shareholders."

Analysts call

There will be a call for analysts regarding the equity fund raising and  related arrangements on 14 January 2009 at 0830 UK / 0930 CET.   Please contact  Laurence Jones of Financial Dynamics at Laurence.jones@fd.com for the dial in details.

Important notice

This announcement includes  statements  that  are,  or  may  be  
deemed  to  be, ''forward-looking  statements''.  These  
forward-looking    statements    can    be identified by the  use  of  
forward-looking  terminology,  including  the  terms ''believes'',    
''estimates'',    ''anticipates'',    ''expects'',      ''intends'',
''may'', ''will'' or ''should''  or,  in  each  case  their  negative
or  other variations or comparable terminology.  These
forward-looking statements  include matters that are not historical
facts.    They  appear  in  a  number  of  places throughout this
announcement and include statements  regarding  the  intentions,
beliefs or current expectations of the Company and its group.  By
their  nature, forward-looking statements involve risks and
uncertainties because  they  relate to events and depend on
circumstances that may or may not occur in  the  future.
Forward-looking statements  are  not  guarantees  of  future  
performance.    The business, financial condition,  results  of  
operations  and  prospects  of  the Company and its group may change.
Except  as  required  by  law  or  applicable regulation, the Company
does not undertake any obligation to update any forward- looking
statements, even though the situation of the Company or  its  group  
may change in the future.  All of the information presented  in  this
announcement,

@@start.t7@@and  particularly  the  forward-looking  statements,  is  qualified    by    these cautionary statements.

For further information:

Financial Dynamics:                                                  +44 (0)20 7831 3113
Richard Sunderland@@end@@

Stephanie Highett Laurence Jones Richard.sunderland@fd.com

----------------------- [1] In each case, assuming that no warrants are exercised by the Investors.

@@start.t8@@end of announcement                                                 euro adhoc
--------------------------------------------------------------------------------@@end@@

ots Originaltext: Atrium European Real Estate Limited
Im Internet recherchierbar: http://www.presseportal.ch

Further inquiry note:
Financial Dynamics, London
Stephanie Highett / Richard Sunderland
Phone: +44 (0)20 7831 3113
mailto:richard.sunderland@fd.com

Branche: Real Estate
ISIN:      AT0000660659
WKN:        066065
Index:    Standard Market Continous
Börsen:  Wiener Börse AG / official market



Weitere Meldungen: Atrium European Real Estate Limited

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