MirLand Development Corporation plc, one of the leading residential and commercial property developers in Russia, announced that agreements have been entered into today for the sale of Techagrocom-2 by a MirLand joint venture company. MirLand holds an effective 50% interest in Techagrocom-2, a business park development which is located on a 22 hectare site located near Mamyri Village in the Leninsky District of Moscow which will provide circa 163,400 m² of Class B+ office buildings and a trade center on completion.
MirLand originally paid $12.875 million for its 50% interest in the site and an additional $2.2 million has been invested by the Company since the purchase. MirLand expects to recognize approximately $3 million capital gain in its financial reports as a result of the transaction.
The buyer has, by way of security for the completion of the transaction, advanced the $40 million purchase consideration to the seller as an interest free loan and this loan will be satisfied by the execution by the seller of an instrument of transfer in respect of the target company. MirLand expects the transaction to complete by 30 May 2010.
Commenting, MirLand's Chairman, Nigel Wright, said, "We are pleased that an easing of market conditions in Russia has enabled us to realise this investment on favourable terms. We intend to apply the net proceeds of the transaction towards consolidating our financial position so that we can continue focussing our efforts on developing those projects which offer us the best prospects of delivering shareholder value."