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«Jelmoli announced today its intention to split the Company into two independent, publicly-traded entities: a Real Estate company and an Investment company. Both entities would be listed on the Swiss Stock Exchange (SWX) and would rank among the leading players in Switzerland in their respective businesses. The intended separation is the outcome of the strategic review, the initiation of which was announced at the extraordinary shareholders meeting as at December 7, 2007.
Commenting on the announcement, Christopher Chambers, Chairman of Jelmoli's Board of Directors said: "We have undertaken a thorough strategic review of our business and, together with our advisors, have determined what would be in the best interests of the Company, the employees and the shareholders. By creating two companies with industry leading positions it allows the two management teams to have the focus, flexibility and suitable capital structure and for both businesses to flourish in their own sectors. We also wish to give shareholders the opportunity to choose which particular business and whichparticular focus they wish to be invested in."
Proposed structure: two independent companies
The Real Estate company, which will continue to operate under the name of Jelmoli, will comprise primarily of the high quality Swiss real estate portfolio, including current development projects. The House of Brands and Bonus Card will also be part of the Real Estate company, as the Board of Jelmoli believes that significant value can be created through further optimization of the retail operations together with the most valuable property in the portfolio.The Investment company will comprise of liquid funds, the less conservative participations in Russia, Algeria and Seiler Hotels as well as Molino, Beach Mountain and Fundgrube. Based on the current plan, the creation of the two stand-alone businesses is expected to take the form of a tax-neutral distribution of the shares of the investment company, resulting in Jelmoli shareholders holding shares of the separate companies. In a second step it is intended to remove the dual class share structure in the Real Estate company in exchange for a reverse premium to compensate the current controlling shareholder, Pelham Investments SA, for relinquishing its voting majority.
Shareholder approvals required
The completion of the separation and the unification of the share structure in the Real Estate company would be subject to shareholder approvals, receipt of a ruling from the competent tax authorities as to the tax-neutral nature of any transaction, filing of the respective listing documents with the SWX and further legal review. The Company
anticipates that the separation of its businesses and the unification of the share structure in the Real Estate company, if consummated, could take place by early 2009. Jelmoli will update its shareholders at the annual shareholders meeting scheduled for 18 June 2008 on the progress made and timing of the implementation of the strategic plan. Jelmoli notes that at the moment there can be no assurance that any separation, transaction or unification of the shares in the Real Estate company will ultimately occur or, if one does occur, its terms and timing».(CS della Società).
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