TIDMERET

RNS Number : 6927R

European Real Estate Inv Tst Ltd

30 October 2013

European Real Estate Investment Trust Limited

30 October 2013

The Board announces today that the European Real Estate Investment Trust Limited ("the Group") has agreed a refinancing with the Lloyds Banking Group ("LBG") in relation to all its loan, hedging liabilities and exit fees which currently stand at EUR159.7 million. The key elements of the new facility include:

-- Extension of the loan maturity from 5 January 2014 to 30 June 2014, subject to reducing LBG liabilities to EUR68.0 million by 31st December 2013;

   --      All proceeds from sales to be applied to repaying debt;

-- No distributions are to be made to shareholders until the LBG liabilities have been met in full;

   --      A full cash sweep of surplus net rental income until all LBG liabilities are met;

-- The margin on the debt facility is to remain at 2.75% per annum over 3 month Euribor, reducing to 2.25% should the LTV fall below 60%. The current LTV is 61.6%;

-- Upon expiry on 5 January 2014 the interest rate swaps will not be extended and the Group will be unhedged against interest rate movements from 6 January to 30 June 2014. Based on current 3 month Euribor, this would result in a decrease in the interest rate from 5.42% p.a. to approximately 3% p.a.;

   --      Potential to reduce exit fees by up to EUR2.8m subject to timing of sales.

On signing of this loan re-financing, the Group's Cross Currency Swap ("CCS") has been broken, with payment deferred to 30 June 2014. This provides certainty as to the maximum liability associated with the Group's CCS, which has been confirmed by breaking the CCS at EUR17.0m.

Investors should note that since the CCS has been broken, the Group no longer has a currency hedge in place.

Following negotiations with LBG specific to the loan structure, and subject to reducing LBG liabilities from EUR221.3m as at 31 May 2013 to EUR68.0 million by 31 December 2013, LBG would accept by 30 June 2014, a reduction of up to 5.7% (including exit fee savings) in full and final settlement of all current loans, hedging liabilities and exit fees.

The successful refinancing and restructure of the loan is an important step in the realisation strategy of the Group. When combined with both the recently announced asset sales and future planned sales, this will assist in maximising value for shareholders.

For further information, please contact:

Praxis Fund Services Limited

   Shona Darling                                       Phone: +44(0) 1481 755528

Cenkos Securities plc

   Dion Di Miceli                                        Phone: +44 (0) 20 7397 1921

Schroder Property Investment Management Ltd

   Duncan Owen / Tony Smedley                  Phone: +44(0) 20 7658 6000

This information is provided by RNS

The company news service from the London Stock Exchange

END

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