Following the clearing of all the conditions precedent linked to the agreements signed on June 20, 2017 with Eurosic’s main shareholders, Gecina has finalized its acquisition of the blocks of shares and OSRA bonds representing 85.4% of Eurosic’s diluted capital. With this transaction, Gecina has effectively taken control of Eurosic.
This major operation represents a significant acceleration of the deployment of Gecina’s strategy, building on its outstanding value creation, which will benefit in particular from the following factors:
- Stronger office portfolio in the Paris Region’s most buoyant business sectors: the combination of the portfolios and the sales programs that are underway will make it possible to further strengthen the percentage of offices within the consolidated portfolio (over 80%), while also ramping up its focus on central sectors (over 60% in Paris City).
- Better coverage of the Paris office market: Gecina’s presence at the heart of the city of Paris will be further strengthened, not only in Paris’ central business district (CBD), but also in new sectors with strong potential on the River Seine’s left bank and the CBD’s eastern border.
- Greater value creation potential for the coming years: this operation has also increased the weighting of the portfolio of development projects, with deliveries expected primarily for 2017 to 2019 and 44% of the space already pre-let.
- Expected acceleration in the portfolio’s rotation: Gecina has launched a sales program with a minimum of 1.2 billion euros for the next 12 months. These sales will cover assets from the historical scope of both Gecina and Eurosic. This rotation will make it possible to continue rationalizing the Group’s portfolio around the Paris Region’s most dynamic sectors, where Gecina has recently secured major lettings transactions, while maintaining the flexibility of its balance sheet.
- Financial structure preserved and liquidity strengthened: the operation has been fully financed, thanks in particular to 1.5 billion euros of bond issues with an average maturity of 10 years and an average coupon of 1.3%, as well as a 1 billion euro capital increase carried out in August 2017. The LTV will therefore remain below 40% following the sales program that is underway. In addition, this operation will make it possible to increase the float by nearly 10% from 51% to 55%, further strengthening the liquidity of Gecina’s securities on the stock market.
The acquisition of these blocks of shares and OSRA bonds from Eurosic’s main shareholders will be followed by an alternative takeover offer and exchange offer, filed this morning, for the shares and OSRA bonds not yet held by Gecina, which is expected to result in Eurosic being delisted before the end of 2017. Some of Eurosic’s main shareholders have made commitments under the agreements signed on June 20, 2017 to tender nearly 9.5% of the diluted capital for the offer’s exchange component, which already guarantees that Gecina will hold almost 95% of Eurosic’s diluted capital following the public offering.
On August 7, Gecina received approval from the French antitrust authorities for this amicable takeover operation.
Méka Brunel, Chief Executive Officer: “By finalizing its acquisition of 85% of Eurosic’s capital, Gecina has taken a historic step forward with the acceleration of its strategy, enabling the Group to continue building on and strengthen the optimization of its profitability with a total return focus, aligned with the interests of all its shareholders. Gecina’s potential will be further strengthened thanks to the acceleration of its portfolio’s rotation, its pipeline that is unrivalled in continental Europe and above all its stronger presence at the heart of the Paris Region, Europe’s leading office market.”
 At June 30, 2017, on a fully diluted basis taking into account the OSRA subordinated redeemable bonds and excluding treasury stock, representing a total of 64,732,147 shares
 Including negotiations that are currently being finalized
 This sales program may potentially be increased by a further 1 billion euros depending on market opportunities
 Assuming that Norges participates in the capital increase with preferential subscription rights prorated to its interest in the Group’s capital and Eurosic’s minority shareholders tender 50% of their securities for the public offering’s securities branch.
 The offer, whose terms are described in a draft offer document that has been filed with today and is still subjected to review by the French Financial Markets Authority (AMF), would be based on:
- An alternative takeover offer and exchange offer for Eurosic’s shares, comprising:
- A public takeover offer under which Eurosic’s shareholders will be able to sell their shares at a cash price of 51 euros per share (cum-dividend for 2017);
- A public exchange offer under which Eurosic’s shareholders will be able to exchange 64 shares (cum-dividend for 2017) for 23 Gecina shares (cum-dividend for 2017);
- An alternative takeover offer and exchange offer for the 2015 OSRA bonds and 2016 OSRA bonds, comprising:
- A public takeover offer under which Eurosic OSRA bond holders will be able to sell their 2015 OSRA bonds (cum-coupon) and their 2016 OSRA bonds (ex-coupon, scheduled for payment to 2016 OSRA bond holders on September 26, 2017) at a cash price of 51 euros per 2015 OSRA bond or 2016 OSRA bond;
- A public exchange offer under which Eurosic OSRA bond holders will be able to exchange 64 2015 OSRA bonds (cum-coupon) or 64 2016 OSRA bonds (ex-coupon, scheduled for payment to 2016 OSRA bond holders on September 26, 2017) for 23 Gecina shares (cum-dividend for 2017) to be issued.
 Subject to Gecina holding more than 95% of Eurosic’s capital or voting rights following the public offering
 Based on an indicative timeline
Source : Company