Investment Update

RNS Number : 2423Y

Carpathian PLC

20 December 2010

 



Date:	20 December 2010
On behalf of:	Carpathian PLC ("Carpathian", the "Company" or the "Group")
Embargoed until:	0700hrs

Carpathian PLC

Investment Update

The Board of Carpathian Plc (AIM: CPT) is pleased to announce the signing of a Preliminary Sale Agreement for the Promenada Shopping Centre, having a likely completion date during March 2011. The buyer is MD Poland I Sp z o.o, a subsidiary of Atrium European Real Estate Ltd., one of the leading real estate companies focused on shopping centre investment, management and development in Central and Eastern Europe.

Promenada is located in Warsaw, Poland and comprises a shopping and leisure centre of 43, 528 sq m of lettable space. Additionally, it also has 12,058 sq m of office accommodation.

The agreed sale is at a Headline figure of €169.5 million, with an additional €1.5million payable upon successful recovery of VAT by Atrium. The Headline price is subject to adjustments estimated at the time of signing of € 2.5million, comprising items that will either be deducted from the price or paid by Carpathian prior to closing.   

The transaction is also subject to new escrow accounts being established of approximately €6.5million. The Company expects to recover the majority of the escrowed funds within six months from closing.

The property was acquired by Carpathian in two parts in 2006 and 2009 for €144.5 million. The 2009 year end valuation stood at €157.5m.

The properties are subject to a loan and an interest rate hedging instrument from Deutsche Pfandbriefbank AG ("DPB") totalling €104.3 million. The loan also has a limited commitment for debt reduction attached to DPB's separate loan against the Company's non-core asset; Babilonas in Panevezys, which would require a further payment of €1.2million assuming the prior sale of Carpathian's Blue Knight portfolio.

Following the sale, the NOI earned to the Company will be reduced by approximately €12.0 million.

The Company intends to review the cash proceeds required to meet its current working capital requirements in the context of the current sales programme and then to distribute as much as possible of these net proceeds to shareholders as soon as practicable in accordance with the previously declared intentions of the Board.

Enquiries:

Carpathian PLC
Rory Macnamara, Non-executive Chairman	Via Redleaf Communications
CPT LLP	020 7529 6413
Paul Rogers/Balazs Csepregi	[e-mail]
Collins Stewart Europe Limited	020 7523 8350
Bruce Garrow
Redleaf Polhill	020 7566 6700
Adam Leviton/Mike Ward	[e-mail]

Notes to Editors:

-	Carpathian was created in 2005 for the purpose of investing in Central and Eastern European commercial real estate.
-	Carpathian's primary focus is on shopping centres, supermarkets and retail warehousing in Croatia, the Czech Republic, Hungary, Poland, Romania, Lithuania and Latvia.
-	Carpathian was admitted to trading on AIM in July 2005.
-	CPT LLP is the Property Investment Adviser to Carpathian. CPT LLP owns 100% of Carpathian Asset Management Limited ("CAM").  CAM, which was previously owned 50% by the Company, became fully externalised when the Company and CPT LLP implemented the new portfolio management agreement on 1 March 2010. CAM, together with its parent undertaking, CPT LLP, is responsible for managing the core portfolio of assets and transactions within Central and Eastern Europe.

 

END

 

 

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