Exit of Rua do Laborat?rio

RNS Number : 5955B

Macau Property Opportunities Fund

22 February 2011

 



22 February 2011

Macau Property Opportunities Fund Limited

("MPO" or the "Company")

MPO to exit its Rua do Laboratório project for US$41 million

Pre-development disposal generates net ROI of 84%

Macau Property Opportunities Fund Limited, managed by Sniper Capital Limited, today announces that it has agreed terms to sell its Rua do Laboratório site, an entry level residential redevelopment property located in northern Macau Peninsula.

A local developer has agreed to purchase the property for HK$320 million (c. US$41 million), representing a gross gain of 92% over the acquisition cost of HK$166 million (c. US$21 million) in November 2006. The net profit of HK$148 million (c. US$19 million) translates to a return on investment of 84% or an internal project rate of return of 15%.

Following the signing of the Sales & Purchase Agreement, the Company has received an initial deposit of HK$50 million (c. US$6 million), representing approximately 15% of the sale price. Completion of the transaction and final payment is due within 60 days and no later than 18 April 2011.

Disposal Decision

The decision to dispose of Rua do Laboratório prior to the completion of its full development cycle was taken as part of MPO's objective to unlock value and crystallise returns for its shareholders.

The sale also avoids two years of potential construction and marketing risk and capitalises on the value that has been created since acquisition through securing the property title, obtaining vacant possession, completing demolition, clearance of the site and achieving architectural planning approval.

In light of the above factors, the Board is of the view that the sale consideration - amounting to a 3% discount to the project's latest valuation of HK$330 million (c. US$42 million) as at 31 December 2010 - is fair and justified.

Use of Proceeds

The proceeds arising from this sale will strengthen MPO's cash position to c. US$61 million. The Manager and the Board will carefully consider the use of the sales proceeds, with a view to maximising shareholders' returns. Further details on the use of the sales proceeds will be announced prior to the completion date in April 2011.

David Hinde, Chairman of MPO said: "Exiting the Rua do Laboratório project at this time crystallises returns for our shareholders, while capitalising on the project value created by the Manager to-date."

--Ends-

About Macau Property Opportunities Fund

Macau Property Opportunities Fund Limited is a closed-end investment fund registered in Guernsey. Its shares began trading on AIM in June 2006, when it raised £105 million in an institutional placing, before moving to the Main Market of the London Stock Exchange in June 2010. The Company's investment policy is to provide shareholders with an attractive total return through investing in property opportunities in one of the world's fastest growing and most dynamic regions - Macau and the Western Pearl River Delta of Southern China.

The Fund is managed by Sniper Capital Limited, an independent investment manager that specialises in property investment opportunities in niche, undervalued and developing markets.

For further information:

Website: www.mpofund.com

Public Relations

MHP Communications

Simon Hockridge / Andrew Jaques

Tel: [phone]

Corporate Broker

Collins Stewart Europe Limited

David Yovichic / Dominic Waters

Tel: [phone]

Company Secretary & Administrator

Heritage International Fund Managers Limited

Mark Huntley / Laurence McNairn

Tel: [phone]

Manager

Sniper Capital Limited

Joyce Lo

Tel: [phone]

Email: [e-mail]

www.snipercapital.com

Stock Codes:

Bloomberg:    MPO LN

Reuters:      MPO.L

 

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