DGAP-News: GAGFAH Resolves on Sale of Treasury Shares and Capital Increase to Accelerate Strategy / Fortress to Reduce Shareholding in GAGFAH

DGAP-News: GAGFAH S.A. / Schlagwort(e): Kapitalerhöhung GAGFAH Resolves on Sale of Treasury Shares and Capital Increase to Accelerate Strategy / Fortress to Reduce Shareholding in GAGFAH

09.07.2013 / 18:40 

THIS ANNOUNCEMENT MAY NOT BE PUBLISHED, TRANSMITTED OR DISTRIBUTED IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR IN OR INTO ANY JURISDICTION WHERE DOING SO WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT IS NOT AN OFFER TO SELL OR A SOLICITATION TO BUY SECURITIES IN ANY JURISDICTION, INCLUDING THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN. NEITHER THIS ANNOUNCEMENT NOR ANYTHING CONTAINED HEREIN SHALL FORM THE BASIS OF, OR BE RELIED UPON IN CONNECTION WITH, ANY OFFER OR COMMITMENT WHATSOEVER IN ANY JURISDICTION.

Press Release: July 9, 2013 GAGFAH S.A. 2-4, rue Beck L-1222 Luxembourg

ISIN: LU0269583422 Frankfurt Stock Exchange (Ticker Symbol: GFJ) Regulated Market (Prime Standard)

GAGFAH Resolves on Sale of Treasury Shares and Capital Increase to Accelerate Strategy / Fortress to Reduce Shareholding in GAGFAH

- Fortress will reduce its shareholding to below 50 % post the successful completion of the offering

- Sale of a total of 40,000,000 GAGFAH shares consisting of

- 10,500,000 treasury shares,

- 9,500,000 newly issued shares, and

- 20,000,000 shares sold by current majority shareholder Fortress

- The proceeds received by the Company will allow GAGFAH to accelerate its strategy of improving its capital structure and pursuing additional value-enhancing capex projects

- 2013 guidance of 5 % - 10 % FFO per share growth confirmed, also on fully diluted basis

- 2014 guidance of 7.5 % - 12.5 % FFO per share growth

- GAGFAH intends to resume dividend payments for the second half of 2014, to be paid in 2015 

Today, GAGFAH S.A. ('GAGFAH') resolved to place 10,500,000 treasury shares and to issue 9,500,000 new shares.

At the same time, Fortress Investment Group LLC ('Fortress') and its affiliates have decided to reduce their holdings in GAGFAH by selling 20,000,000 GAGFAH shares as part of the transaction. Fortress and its affiliates own a total of 60.8 % of GAGFAH shares prior to the offering. Following the successful completion of the combined offering, Fortress and its affiliates will reduce their holdings in GAGFAH to below 50 %.

The Company intends to use the net proceeds of this offering to accelerate its capital structure improvements and to pursue additional value-enhancing capex projects in its real estate assets.

Thomas Zinnöcker, CEO of GAGFAH GROUP, commented: 'GAGFAH has made significant progress in refinancing large parts of its near-term debt and is taking a revised approach to managing its portfolio. We believe that there continues to be sufficient appetite for German residential stocks among the investment community, and we are taking this capital increase as a key step to support our strategy. The proceeds will be primarily used to optimize our capital structure and to invest in additional value-enhancing capex projects.'

Gerald Klinck, CFO of GAGFAH GROUP, added: 'We intend to use two thirds of the proceeds from this transaction to delever the debt on the NILEG entities. The weighted average coupon on that portfolio is currently approximately 5.11 %, and by reducing the debt volume and refinancing at current interest rate levels, we can resolve our remaining major refinancing obligations and achieve attractive yields on the equity proceeds. The remaining one third of the proceeds from the capital raise will go into modernization projects, for which we target a yield of more than 7.5 %.'

In spite of the higher share count following the completion of this transaction, GAGFAH reiterates its FFO guidance for this year, which is 5 % - 10 % FFO per share growth, also on a new diluted share basis.

For 2014, GAGFAH is targeting 7.5 % - 12.5 % FFO per share growth through operational improvements. Upon completion of this transaction, the planned operational improvements, and the successful refinancing of the 2014 maturities, GAGFAH intends to resume dividend payments for the second half of 2014, to be paid in 2015.

The new shares shall be admitted to trading on the regulated market on the Frankfurt Stock Exchange. The shares being sold shall be offered to institutional investors for purchase by way of an accelerated bookbuilding. Both GAGFAH and Fortress have agreed to a lock-up of 120 days as of the closing of the transaction.

Deutsche Bank and Goldman Sachs International are acting as Joint Global Co-Ordinators and together with UniCredit Bank AG as Joint Bookrunners for the transaction.

Contact

Investor Relations Rene Hoffmann Tel.: +352 266 366 21 Mail: rhoffmann@gagfah.com www.gagfah.com GAGFAH S.A. 2-4, rue Beck L-1222 Luxembourg R.C.S. Luxembourg B 109.526 

Media Dirk Schmitt Tel.: +49 201 1751 362 Mail: dschmitt@gagfah.de www.gagfah.de GAGFAH GROUP Prinzeß-Luise-Straße 33 D-45479 Mülheim a. d. Ruhr

About GAGFAH S.A.

GAGFAH S.A. is a joint stock corporation organized under the laws of the Grand Duchy of Luxembourg qualifying as a securitization company under the Luxembourg Securitization Law of March 22, 2004. The core business of GAGFAH S.A.'s operating subsidiaries is the ownership and management of a residential property portfolio located in Germany.

GAGFAH's portfolio includes approximately 145,000 own residential units and more than 40,000 units under property and facility management for third parties. Our portfolio makes us one of the largest residential property companies listed in Germany, and we believe that our size, our significant presence in the key residential markets and our scalable operating platform make us one of the leading providers of housing for low- to medium income households in Germany. Our operating subsidiaries are full-scale service providers for a broad range of property and facility management services with a clear focus on residential properties. The key elements of our strategy are (i) to create sustainable and increasing cash flows out of the existing asset base (rent, occupancy, property costs, platform), (ii) to invest in value-enhancing portfolio properties, (iii) to pursue accretive growth opportunities, and (iv) to realize value through asset sales.

This announcement is for information purposes and is not intended to constitute, and should not be construed as an offer to sell or a solicitation to buy or subscribe to any securities, and the offer of GAGFAH S.A. shares does not constitute a public offer in any jurisdiction. Any public offer of securities would be made by means of a prospectus that contains detailed information about GAGFAH S.A., including financial statements. In accordance with the Prospectus Directive (2003/71/EC, as amended by Directive 2010/73/EU), no prospectus is required in connection with the issuance of securities described in this announcement. A prospectus will not be published in connection with the bookbuild.

Neither this announcement nor the information contained in it may be taken, transmitted or distributed directly or indirectly into the United States of America (including its territories and dependencies, any State of the United States and the District of Columbia). The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the 'Securities Act'), and may not be offered or sold in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. Neither this announcement nor the information contained herein constitutes or forms part of an offer of securities for sale or the solicitation of an offer to buy securities in the United States of America or in any other jurisdiction. There will be no public offer of any securities in the United States of America or in any other jurisdiction.

This announcement includes statements that are, or may be deemed to be, forward-looking statements. Any forward-looking statements are subject to risks relating to future events and assumptions relating to GAGFAH's business. No assurances can be given that the forward-looking statements in this announcement will be realized. As a result, no undue reliance should be placed on these forward-looking statements as a prediction of actual results or otherwise.

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09.07.2013 Veröffentlichung einer Corporate News/Finanznachricht, übermittelt durch die DGAP - ein Unternehmen der EQS Group AG. Für den Inhalt der Mitteilung ist der Emittent / Herausgeber verantwortlich.

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Sprache: Deutsch Unternehmen: GAGFAH S.A. 2-4, rue Beck 1222 Luxemburg Großherzogtum Luxemburg Telefon: + 352 266 366 1 Fax: + 352 266 366 01 E-Mail: info@gagfah.com Internet: www.gagfah.com ISIN: LU0269583422, LU0269583422 WKN: A0LBDT Indizes: MDAX Börsen: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, Hamburg, München, Stuttgart

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