Financing agreement with CPPIB and Cairn Capital

RNS Number : 6375Z

Globalworth Real Estate Inv Ltd

31 May 2016

 

Globalworth Real Estate Investments Limited

Globalworth enters into a Euro 180m financing agreement with Canada Pension Plan Investment Board and Cairn Capital

Guernsey, 31 May 2016:  Globalworth Real Estate Investments Ltd. (AIM: GWI) ("Globalworth" or the "Company"), the real estate investment company targeting opportunities in Romania, is pleased to announce that it has signed a three-year Euro 180 million secured bond transaction fully subscribed by Canada Pension Plan Investment Board ("CPPIB"), through its wholly owned subsidiary, CPPIB Credit Investments Inc. (CPPIB Credit), and funds managed by Cairn Capital ("Cairn") (the "Bond").  Cairn Capital has acted as arranger for the bond issue.

The proceeds of the Bond transaction will go towards refinancing the Euro 100m corporate level facility granted by funds managed by York Capital and Oak Hill Advisors in 2015 as well as three facilities at the level of three of the Company's Romanian property owning subsidiaries. 

The bond is listed on the Channel Islands Stock Exchange and is secured by four of the Company's real estate assets.  As a result of this transaction the weighted average all-in cost of debt financing of the Company is reduced from 6.2% to 5.3% on a run rate basis.

Completion of the Bond is subject to satisfaction of certain conditions precedent which are customary for a facility of this nature and which are expected to be satisfied shortly. A further announcement will be made on completion.

Ioannis Papalekas, Founder and Chief Executive Officer of Globalworth said: "Securing the support of international real estate investors of the calibre of CPPIB is a huge endorsement of Globalworth and our position in the Romanian market.  We have built a portfolio of properties that we are proud of and will continue to be an active investor where we see value, thus cementing our position as one of the leading real estate investors in the region. With a local presence and established expertise, Globalworth is very well positioned to take advantage of attractive investment opportunities as they arise."

CPPIB is a professional investment management organization that invests the funds not needed by the Canada Pension Plan (CPP) to pay current benefits on behalf of 19 million contributors and beneficiaries. Headquartered in Toronto, with offices in Hong Kong, London, Luxembourg, Mumbai, New York City and São Paulo, CPPIB is governed and managed independently of the Canada Pension Plan and at arm's length from governments. At March 31, 2016, the CPP Fund totalled C$278.9 billion.

Cairn Capital is a London-based full-service credit asset management, advisory and securities restructuring firm established in 2004. Cairn Capital has $2.1bn of assets under discretionary management and $9.7bn under long term advice (as at 31 January 2016).

For further information visit www.globalworth.com  or contact:  

Panmure Gordon (Nominated Adviser and Joint Broker)                             Tel: [phone]

Andrew Potts

Cantor Fitzgerald Europe (Joint Broker)                                                               Tel: [phone]

Rick Thompson

David Foreman

Milbourne (Public Relations)                                                                                    Tel: [phone]

Tim Draper

About Globalworth:

Globalworth Real Estate Investments Limited is a real estate investment company founded by real estate investor and developer Ioannis Papalekas currently focused on taking advantage of investment opportunities in Romania.  The Company's shares were admitted to trading on AIM in July 2013.

The Romanian market offers an attractive real estate investment proposition in the medium-to-long term. Globalworth believes that global investor capital flows will gradually move from markets considered as "safe havens" to more peripheral markets such as Romania in search of higher yielding investments. As a result, Romania should, in due course, become a more attractive destination for a wide investor audience. Globalworth anticipates holding an early mover advantage in and benefitting from this gradual shift in investor sentiment.

Additional information on the Bond

The Bond provides for an upfront fee, a cash coupon and a prepayment fee which can vary depending on different repayment events and timing.  The Bond also contains representations and warranties, covenants and events of default customary for a facility of this nature.

As part of the Bond terms, Ioannis Papalekas has entered into certain negative pledge arrangements and an ongoing covenant regarding his shareholding and the level of debt secured against such shareholding. In addition, there are certain keyman events in relation to Ioannis Papalekas which, if triggered, would impact upon the Company's ability to make distributions out of the property owning companies secured by the Bond.

 

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