Reference is made to the stock exchange notice dated 21 October 2024 including, inter alia, an update on debt financing and the process for establishing necessary security for an increased loan amount provided by Penchev Consult.
Black Sea Property AS ("BSP" or the "Company") and Trem Holding AD (a holding company owned by BSP's local Bulgarian partner, Mr. Boyan Bonev), as owners of the Sunrise Gardens Resort (the "Resort") are currently in initial discussions with parties interested in acquiring the Resort, with an ambition to conclude a preliminary agreement during the next six months. A preliminary agreement would typically imply granting exclusivity and include main terms and conditions for a definitive agreement, including, among other matters, conditions precedent for completion of a transaction. The Board wants to emphasize that the ongoing discussions are of a preliminary character, including, without limitation, with regards to purchase object (completed vs. non-completed units), valuation and payment terms and transaction model (property vs. company sale).
Further, the Company has received preliminary offers for two of the land plots in the towns of Byala and Obzor respectively, valued slightly above book value for both plots (total indication approx. EUR 600.000) . These land plots were acquired by BSP through the merger with Bulgaria Eiendom Invest AS in 2021. A further clarification of any transaction for these land plots is expected to take up to 6 months.
The process for a corporate restructuring of the jointly owned real estate company EPO Aheloy plc. into a joint stock company in Bulgaria is still not in place, and consequently the planned additional bridge financing of up to EUR 2,0 million (the "Penchev II Loan") has not been made available. This means that the outstanding loan of EUR 450.000 from BSP to EPO Aheloy has not been repaid, and therefore the shareholder loan of approx. NOK 5,3 million from certain shareholders of the Company to BSP is still outstanding (latest agreed due date for repayment is June 30, 2025, with conversion right for lenders thereafter). Alternative corporate structures are being considered to speed up the process for obtaining the Penchev II Loan.
As previously informed, a satisfactory liquidity situation for BSP parent company has been dependent of the repayment of the mentioned EUR 450.000 loan granted to EPO Aheloy , based on the availability of the Penchev II loan. Therefore, BSP will shortly need funds for day-to-day management and operations of minimum NOK 2,0 million, which is anticipated to cover planned operating expenses for the Company for the remaining calendar year 2025. A process has been initiated by the Board to secure such funds, and further information will be given in due course.
For further information, please contact:
Egil Melkevik, Chairman
Tel: +47 90 77 09 76
E-mail: em@ms-solutions.no
About Black Sea Property AS: Black Sea Property AS is a real estate company with holdings in a real estate project on the Black Sea coast called Sunrise River Beach Resort. Sunrise River Beach Resort is a partially completed project and will upon completion comprise approximately 950 apartments as well as significant commercial space.