Planning Application and Restructuring Update (6036Y)
24 Dezember 2010 - 12:30PM
UK Regulatory
TIDMREOP TIDMREO
RNS Number : 6036Y
REO Securities Limited
24 December 2010
Real Estate Opportunities plc (the "Company", "REO")
Mayor's Approval of the Battersea Power Station Planning
Application
and Update on Restructuring
24 December 2010
The Company is pleased to announce that the Mayor of London has
approved the planning application for the redevelopment of the
Battersea Power Station site. The Mayor's approval of the planning
application represents another major step towards realising the
vision for the redevelopment of Battersea Power Station. The
planning application is now with the Secretary of State for
Communities and Local Government for consideration. The Company
will provide a further update on the planning process in due
course.
In view of the time that has elapsed since the Company first
indicated its intention to implement a financial restructuring, the
Company believes it appropriate to update shareholders on the
status of its discussions with creditors and the terms upon which,
subject to approval by creditors, the restructuring may proceed.
Negotiations with creditors have progressed well and are ongoing.
Were the restructuring to be approved by creditors and to proceed
on the terms discussed with creditors, the restructuring would
comprise the following key elements:
-- Battersea Power Station would be transferred by REO to a new
holding company. The demerger of Battersea Power Station is
intended to facilitate the successful conclusion of the Company's
global third party investment road show through which it is seeking
to attract a long term equity partner into the demerged
vehicle.
-- The Company would effect debt for equity swaps with the
holders of the 7.5% convertible unsecured loan stock ("CULS") and
zero dividend preference shares ("ZDPs"). CULS holders would
receive 21.2% of the equity in the new Battersea Power Station
holding company and 15.9% of the enlarged equity of REO. ZDP
holders would receive 12.1% of the equity in the new holding
company and 9.1% of the enlarged equity of REO. In addition, CULS
and ZDP holders would be issued with warrants representing 15.9%
and 9.1% respectively of the initial issued share capital of the
new holding company. Each warrant would entitle the holder to
subscribe for one new ordinary share at an exercise price of 0.001p
at any time for up to 15 years after the completion of the
restructuring if the equity in the new holding company has a value
in excess of GBP510 million.
-- Ordinary shareholders (including Treasury Holdings) would
receive 5% of the equity in the new holding company and warrants in
respect of a further 5% and would, after the issue of ordinary
shares to CULS and ZDP holders, retain 75% of the enlarged equity
of REO.
-- As an incentive to manage the development of Battersea Power
Station, Treasury Holdings would be awarded a management fee
representing 7.7% of the equity in the new holding company.
-- The remaining equity in the new holding company, amounting to
approximately 54%, would be retained by REO and its subsidiaries
following the equitisation of various intercompany balances owed by
companies in the Battersea Power Station group.
-- REO would be released from various financial obligations
relating to the Battersea Power Station group, including guarantees
of senior facilities and the GBP150 million loan note issued to
Oriental Property Limited.
-- If the GBP150 million loan note and accrued interest is not
repaid on 31 May 2011, Oriental Property Limited would, subject to
certain exceptions, have the option to convert the debt into 75% of
the equity in the new Battersea Power Station holding company.
Shareholders in the new holding company would have the right to
acquire that interest prior to 1 June 2012 for an amount equal to
the sum due to Oriental Property Limited under the loan note
together with interest.
A further announcement will be made in due course.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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