Cofinimmo disposes of lease receivables for €200 million (BE)

Cofinimmo has announced it has sold to BNP Paribas Fortis, for a total amount of €199.6 million, 96% of the future indexed lease receivables on the office buildings Egmont I and Egmont II, as well as a receivable for the works realized in these buildings for the account of the occupant.

Cofinimmo retains however 100% of the lease payments pertaining to the years 2009 and 2010, in order not to affect their recurrent cash flow income. The 96% receivables which are disposed of therefore only relate to the year 2011 and beyond.

Subsequent to this disposal, Cofinimmo's consolidated debt ratio, as laid down by the regulation governing Sicafis, is reduced by 3.08 percentage points. As a reminder, at 30.06.2009 this ratio stood at 52.94%. Hence, if this disposal would have been carried out before the end of the first halfyear, it would have reached 49.86%.

This transaction tallies with Cofinimmo's financing policy and allows the company to efficiently reinforce its capital structure and to balance out its sources and applications of funds. Indeed, the proceeds resulting from this disposal, and those expected to be recorded from ongoing office disposals approaching €40 million, fully cover Cofinimmo's investment commitments for the second half‐year of 2009 (€46 million) and the entire year 2010 (€193 million). Cofinimmo currently does not have any other significant investment commitments beyond this timeframe.

This disposal also allows the company, all other things being equal, to continue its strategy focused on a low risk and profitable portfolio growth, as well as the protection of the net asset value per share. Other financial means will only be explored to the extent and insofar as new projects would justify doing so.

The outcome of this disposal is a gain of €12.2 million which will be recognized in the 2009 third quarter results as a non‐recurring financial item. It chiefly stems from the difference between the interest rates applied, on the one hand by the buyer of the receivables (5.52%), and on the other hand by the real estate expert (6.00%), when valorising the rents; the first being favorably impacted by the current low real long term interest rates on the market.

The 2009 dividend forecast, as anticipated by the Board of Directors, remains unchanged.

Source: Cofinimmo

Related News