JZ Capital Ptnrs Ltd Real Estate Valuations

 
TIDMJZCP TIDMJZCN 
 
JZ CAPITAL PARTNERS LIMITED 
(a closed-end collective investment scheme incorporated with limited liability 
           under the laws of Guernsey with registered number 48761) 
                           LEI: 549300TZCK08Q16HHU44 
 
                            Real Estate Valuations 
 
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET 
ABUSE REGULATION (EU) NO. 596/2014 ("MAR"). 
 
 
17 September 2020 
 
JZ Capital Partners Limited ("JZCP" or the "Company"), the London listed fund 
that invests in US and European micro-cap companies and US real estate, today 
announces that it has now received appraisals for most of its real estate 
portfolio assets as at 31 August 2020. The Board and the Company's investment 
adviser had, as previously announced in the Company's annual results for the 
year ended 29 February 2020, commissioned these further appraisals to establish 
an updated value of its real estate investments in light of the effects of the 
Covid-19 pandemic, believing its impact to be potentially significant and 
adverse though its quantum could not be estimated at the time. 
 
Whilst the Company has not yet received all of the appraisals and is still in 
the process of reviewing those that it has received, the newly received 
appraisals do, in line with the Company's previously announced expectation in 
its annual results, indicate materially lower valuations. As a consequence, the 
Company expects it will likely experience further net write downs; based on the 
information at the Company's disposal at this time, the Company currently 
believes the mark down to its net asset value could be in the approximate range 
of between $80 to $100 million, subject to receiving and reviewing all of the 
appraisals. The Company will make further announcements regarding the 
appraisals and related write downs as required. 
 
As a consequence of the aforementioned write downs, the Company currently 
expects that it will require a waiver under its senior facility with Guggenheim 
Partners, as the Company will breach its minimum asset coverage ratio by the 
end of September 2020. The Company is working towards and expects to receive 
such a waiver. Absent this waiver (or otherwise obtaining consent), the Company 
will be prohibited from making an interest payment due on 30 September 2020 to 
the holders of its Convertible Unsecured Loan Stock due 2021 ("CULS"). Any 
interest not paid under the CULS in accordance with the terms of the 
subordination agreement to which the CULS are subject will not constitute a 
default under the CULS. Again, as mentioned above, the Company does expect to 
receive a waiver (or to otherwise obtain consent) to allow for the payment of 
the upcoming interest payment under the CULS. 
 
Moreover, the Company and its lenders have made significant progress in their 
ongoing discussions to amend the current lending arrangements in a favourable 
way to the Company. As is the case for the real estate valuations, the Company 
will make further announcements as required in relation to the status of 
discussions with its lenders including their impact on the CULS as matters 
progress. Separately, the Company is pleased to report that its US micro-cap 
portfolio is performing quite well and positive progress is being made in 
relation to the previously announced secondary sale of certain of its US 
micro-cap assets. It is anticipated that the Company will reach an agreement in 
the near term on the secondary sale and an announcement will follow. The 
secondary sale if completed will provide the Company with the needed liquidity 
to repay a substantial portion of its senior debt. The Company remains 
committed to its strategy of realising value from its investment portfolio, and 
to paying down debt in the first order. 
 
 
Market Abuse Regulation: 
 
The information contained within this announcement is inside information as 
stipulated under MAR. Upon the publication of this announcement, this inside 
information is now considered to be in the public domain. The person 
responsible for arranging for the release of this announcement on behalf of 
JZCP is David Macfarlane, Chairman of JZCP. 
 
For further information: 
 
Ed Berry                                                       +44 (0) 20 3727 
FTI Consulting                                                 1046 
 
David Zalaznick                                                +1 (212) 485 
Jordan/Zalaznick Advisers, Inc.                                9410 
 
Sam Walden                                                     +44 (0)1481 
Northern Trust International Fund Administration Services      745385 
(Guernsey) Limited 
 
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 relate to matters that are not 
historical facts. 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 Company's actual investment performance, 
results of operations, financial condition, liquidity, policies and the 
development of its strategies may differ materially from the impression created 
by the forward-looking statements contained in this announcement. In addition, 
even if the investment performance, result of operations, financial condition, 
liquidity and policies of the Company and development of its strategies, are 
consistent with the forward-looking statements contained in this announcement, 
those results or developments may not be indicative of results or developments 
in subsequent periods. These forward-looking statements speak only as at the 
date of this announcement. Subject to their legal and regulatory obligations, 
each of the Company, the Investment Adviser and their respective affiliates 
expressly disclaims any obligations to update, review or revise any 
forward-looking statement contained herein whether to reflect any change in 
expectations with regard thereto or any change in events, conditions or 
circumstances on which any statement is based or as a result of new 
information, future developments or otherwise. 
 
 
 
END
(END) Dow Jones Newswires
September 17, 2020 02:00 ET (06:00 GMT)
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