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ERWE Immobilien AG: ERWE Immobilien AG resolves
comprehensive financial restructuring
Frankfurt (pta004/11.06.2023/21:45) -
Publication of inside information pursuant to
Article 17 of Regulation (EU) No 596/2014
ERWE
Immobilien AG resolves comprehensive financial
restructuring
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Immediate convening of a bondholder vote
to pass a resolution on, among other
things, the deferral of the interest
payment due on 10 June 2023 and a
conversion of the bond into equity
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Convocation of a general meeting of
shareholders to pass a resolution on a
capital reduction in a ratio of 20 : 1 by
consolidation of shares as well as a
subsequent cash capital increase
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Accompanying operational restructuring
measures and negotiations with further
lenders
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Frankfurt/M., 11 June 2023. Today, the Board of
Management of ERWE Immobilien AG (ISIN:
DE000A1X3WX6), with the approval of the Supervisory
Board, decided on a comprehensive financial
restructuring of the company. The background to this
is the substantial amount of existing debt
liabilities, in particular the bond 2019/2023
maturing in December 2023 (the "
Bond 2023"), and the strained liquidity
situation of the Company due to the sharp rise in
interest rates and the difficult market environment,
which is characterised by a weak operating cash flow
and the continued need for high investments in real
estate project developments. Refinancing these
financial liabilities in the current market
environment is not possible, particularly due to the
lack of debt service capability. A liquidity
shortfall is therefore expected to occur at the
latest when the 2023 bond matures in December 2023.
In order to continue and maintain the company, new
capital is therefore required and a reorganisation of
the liabilities side appears indispensable.
The Company's restructuring concept provides for a
restructuring of the liabilities side of the Issuer's
balance sheet, an adjustment of the financing
structure to improve the equity base, and the
securing of sufficient liquidity to enable the Issuer
to take operational and strategic courses of action,
such as financing construction activities to complete
individual loan-financed properties. In detail, the
following measures are planned.
A key element of the planned measures is the
restructuring of the 2023 Bond. For this purpose, the
Company will call on the bondholders at short notice
for a vote without a meeting, in the course of which
the following resolutions are to be passed:
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Deferral
of the interest payment due on 10 June 2023
until the redemption date
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Waiver
with respect to the exercise of termination
rights under the Notes, inter alia, with
respect to the non-payment of interest as at
the June interest date 2023 and the late
publication of the consolidated financial
statements as at 31 December 2022 and the
interim reports, as well as any termination
right pursuant to section 490 of the German
Civil Code (BGB)
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Exchange
of the bonds into equity - this is done by
granting acquisition rights to new shares of
the company from a capital increase against
contribution in kind. For the entire EUR 40
million 2023 bond plus the interest accrued
until the exchange, bondholders will be offered
6 million new shares from a capital increase
against contributions in kind, with which they
can benefit from future increases in the value
of the company. If bondholders do not exercise
their purchase rights or do not exercise them
in due time, they will receive a cash
settlement corresponding to the share of the
total amount attributable to their bonds from
the realisation of those new shares for which
the purchase rights have not been exercised,
less the realisation costs.
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Appointment
of a joint representative of the bondholders
and authorisations in favour of the joint
representative
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2. Equity measures
On the equity side, a reduction of the share
capital in accordance with §§ 229 et seq.
of the German Stock Corporation Act (AktG) by around
95% to EUR 1,228,146.00 is initially planned. The
full amount of the capital reduction is to be used to
compensate for impairments and to cover other losses
and is to be effected by consolidating shares (at a
ratio of 20 : 1). The Issuer will convene a general
meeting for this purpose in due course.
After the implementation of the capital increase
against contribution in kind, the bondholders
(provided they all exchange) will hold approximately
83% of the shares/share capital of the Company and in
this way will participate appropriately in the
restructured Issuer in order to be able to
participate in a future economic recovery of the
Company. The current shareholders would still hold
approximately 17 % of the Issuer's shares/share
capital.
The company's share capital of EUR 7,228,146.00
after the capital increase through contributions in
kind is then to be increased in a further step
through a capital increase, also to be resolved by
the Annual General Meeting, by issuing a still to be
determined number of new shares against cash
contributions with subscription rights for the
shareholders existing at the time of the resolution,
which is to cover the company's liquidity needs for
the then coming 12 months. The company expects to
raise an amount of up to EUR 12 million.
3. Operational restructuring measures
In addition to the debt and equity restructuring,
the company is examining whether and which properties
or projects can be sold. The focus is particularly on
projects that involve high financing costs that will
place a heavy burden on the company in the coming
months and years without the investments generating
added value for the company. However, this is
extremely difficult in the current market
environment. A sale of individual properties or
project companies may fail due to secured bank loans
and would probably only be possible, if at all, at
values below the senior financing encumbering
them.
As part of the improvement of the financial
position and to improve the current liquidity
situation, the company is also currently in
negotiations with individual lenders regarding the
deferral or restructuring of loans.
The company has also commissioned a renowned
management consultancy to conduct a so-called
Independent Business Review, i.e. an independent
analysis to assess the past and future situation of
the ERWE Group, which should enable stakeholders to
assess the entrepreneurial performance of the ERWE
Group taking into account the restructuring
measures.
The Company plans to hold an investor call for
bondholders in the coming days, after publication of
the convening notice, with regard to the resolutions
to be voted on without a meeting.
For further information please contact:
german communications AG
Jörg Bretschneider
Milchstr. 6 B
20148 Hamburg
T. +49-40-4688330, F. +49-40-46883340
presse@german-communications.com
ERWE Immobilien AG
Hans-Christian Haas
Herriotstraße 1
h.haas@erwe-ag.com Emitter: ERWE Immobilien AG
Adresse: Herriotstraße 1, 60528 Frankfurt
Country: Germany
Contact person: Hans-Christian Haas
Tel.: +49 69 96376869 25
Email: h.haas@erwe-ag.com
Website: www.erwe-ag.com
ISIN(s): DE000A1X3WX6 (Aktie)
Exchanges: Free Market in Berlin, Free Market
in Dusseldorf, Scale in Frankfurt, Free Market in
Stuttgart
Quelle:
https://www.pressetext.com/news/20230611004
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