Gazit-Globe in a Major, Strategic Transaction: Acquires Norway's Sektor Through Its Subsidiary, Citycon, for EUR 1.47 Billion
May 25 2015 - 9:58AM
Chaim Katzman, Chairman of
Gazit-Globe and Citycon: "This Transaction Strengthens the Position
of Gazit-Globe as a Leader in the Global Shopping Center
Industry"
TEL-AVIV, Israel, May 25, 2015 (GLOBE NEWSWIRE) --
Gazit-Globe (NYSE:GZT) (TSX:GZT) (TASE:GZT), one of the world's
leading multi-national real estate companies focused on the
management, acquisition, development and redevelopment of
supermarket-anchored shopping centers in major urban markets,
announced today that its subsidiary, Citycon (42.8%), entered into
an agreement to purchase all of the shares of Norway's second
largest commercial real estate company, Sektor Gruppen, for
consideration amounting to approximately EUR 1.47 billion subject
to customary balance sheet and post-closing adjustments. The
consideration will be paid in cash (approximately EUR 541 million)
and by the assumption of debt. Citycon will become the largest
publicly-listed shopping center company in the Nordic region and
the third largest in continental Europe.
Sektor Gruppen is a private company focused on the
development and operation of supermarket- anchored shopping centers
in Norway. The majority of its assets (95%) are located in the
three main economic centers of Norway - Oslo, one of the fastest
growing cities in Europe, as well as in Bergen and Stavanger, two
major growing cities bordering the North Sea. Total assets under
management exceed 600,000 sqm of which approximately 400,000 sqm
are owned by Sektor. Sektor's revenues in 2014 were EUR 127 million
and its net operating income amounted to approximately Euro 75
million. The net initial yield of the assets is approximately 5.2%
with the potential for substantial organic growth, which is
expected to be accretive to Citycon's earnings per share from 2016.
As of December 31, 2014, the Sektor portfolio had an occupancy rate
of 96.5%.
Citycon intends to finance the acquisition through
a rights issue of approximately EUR 600 million, a EUR 250 million
bridge financing facility obtained from a syndicate of Nordic
banks, and, if necessary, from existing credit facilities. In
addition, waivers have been obtained for approximately EUR 671
million of the existing bank financing facilities of Sektor to
remain in place upon closing. The closing of the transaction is
expected to take place in July 2015.
Gazit-Globe has provided a commitment to subscribe
for its pro rata share (42.8%) in the rights offering,
approximately Euro 257 million, while the second largest
shareholder in Citycon, Canada Pension Plan Investment Board, CPPIB
(15.0%), which is the largest pension fund in Canada, has also
committed to participate in its pro rata share of the rights issue.
The transaction advisers are JP Morgan, SEB and Pangea Property
Partners.
Based on on-going discussions between Citycon and
there crating agencies, Citycon expects that its current credit
rating (BBB from Standard & Poor's and Baa2 from Moody's) will
be maintained after the transaction, subject to the expected rights
offering and other terms related to the transaction.
Chaim Katzman, Chairman of
Gazit-Globe and Citycon: "This major, strategic transaction
further strengthens Gazit-Globe's position as one of the most
significant players in the global shopping center industry as well
as demonstrating our ability to enter into new and attractive
markets, including AAA rated countries with high barriers to entry,
and become a market leader, while further enhancing our portfolio
diversification and our cash flow."
Katzman added: "With this
transaction, Citycon continues to establish its position as the
leading European shopping center company active in the Nordic
region and the third largest in continental Europe as it increases
its asset value to approximately EUR 5 billion. Upon completion,
Citycon's portfolio will benefit from the entry into Norway, an
economy with one of the highest incomes per capita in the world,
which now will comprise 30% of Citycon's portfolio and
approximately 7% of Gazit-Globe's."
About Gazit-Globe
Gazit-Globe is one of the largest owners,
developers and operators of predominantly supermarket-anchored
shopping centers in major urban markets around the world.
Gazit-Globe is listed on the New York Stock Exchange (NYSE:GZT),
the Toronto Stock Exchange (TSX:GZT) and the Tel Aviv Stock
Exchange (TASE:GZT) and is included in the TA-25 and Real-Estate 15
indices in Israel. Gazit-Globe owns and operates 524 properties in
more than 20 countries, with a gross leasable area of approximately
6.3 million square meters and a total value of approximately US$ 21
billion.
FOR ADDITIONAL
INFORMATION |
|
Investors Contact:
IR@gazitgroup.com, Media Contact: press@gazitgroup.com |
Gazit-Globe Headquarters:
Tel-Aviv, Israel, Tel: +972 3 6948000 |
FORWARD LOOKING
STATEMENTS
This release may contain
forward-looking statements within the meaning of applicable
securities laws. In the United States, these statements are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Such statements involve a number of
known and unknown risks and uncertainties, many of which are
outside our control, that could cause our future results,
performance or achievements to differ significantly from the
results, performance or achievements expressed or implied by such
forward-looking statements. Important factors that could cause or
contribute to such differences include risks detailed in our public
filings with the SEC and the Canadian Securities Administrators.
Except as required by applicable law, we undertake no obligation to
update any forward-looking or other statements herein, whether as a
result of new information, future events or otherwise.
CONTACT: For additional information:
Gil
Kotler,
Senior Executive
VP and CFO
Gazit-Globe
Ltd.
1 HaShalom
Rd.
Tel Aviv, Israel
67892
+972 3 694
8000
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Gazit-Globe via Globenewswire
HUG#1923714
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