ECPC European Conv.

 

TIDMECPC 
 
RNS Number : 0340N 
European Convergence Property CoPLC 
10 February 2009 
 

10 February 2009 
 
 
EUROPEAN CONVERGENCE PROPERTY COMPANY PLC (THE "COMPANY" OR "ECPC") 
 
 
Property Revaluation and NAV 
 
 
The Board of ECPC announces the results of an independent revaluation of the 
Company's remaining investment property, Mall Veliko Turnovo ("MVT") in 
Bulgaria. 
 
 
The Board obtained two opinions from independent experts, being valuations by 
SHM Smith Hodgkinson ("SHM") and Jones Lang LaSalle ("JLL"). 
 
 
SHM is a British firm of Chartered Surveyors established in 1860 and 
specialising in property and corporate asset consulting and valuation services. 
In 2004, SHM was acquired by the Gordon Brothers Group of USA. GB Group has 
approximately 300 employees worldwide including SHM offices in London, 
Manchester, Leeds, Bucharest, Belgrade and Kyiv. The firm's Bucharest office 
leads its services across the SEE region and in 2008 completed valuations for 
assets totalling approximately EUR4 billion. 
 
 
JLL is one of the world's leading real estate services and investment management 
firms, employing 30,000 people and having a presence in 700 cities in 60 
countries worldwide. The firm has been active across the SEE markets since the 
mid 1990s, which activities have been led from its Bucharest office since early 
2007. 
 
 
Taking into account the change in global economic and credit market conditions 
both firms have assumed an exit yield which has increased when compared to 
similar benchmarks prevailing during H1 2008. Both firms have also agreed with 
the forecast taken for the management of the asset's rent-roll through the 
expected difficult retail market conditions of 2009. 
 
 
SHM valued the property at EUR28.0m. JLL separately and independently valued the 
property at EUR27.9m. The Board was reassured by the similarity between the two 
valuations, taking into account the difficulty in assessing the value of 
investment property in the prevailing market conditions. 
 
 
For reasons of prudence the Directors have chosen to adopt the lower valuation, 
which shows a decrease in the market value of MVT of EUR3.7m, reducing the value 
from EUR31.6m at the previous valuation on 30 September 2008 to EUR27.9m at 31 
December 2008. The decrease reflects the impact on the retail property 
investment market in Bulgaria resulting from the current global credit 
restrictions and economic conditions. 
 
 
The valuation of the asset is analysed below. 
 
 
+----------+------------+------------+-------------+-----------+-------------+-----------+--------+ 
| EURm       |  Equity    |  External  |    Total    |Valuation  |Revaluation  | Decrease  |   %    | 
|          |Investment  |Borrowings  |Acquisition  | As at 30  |   As at     |   from    |        | 
|          |            |            |    Cost*    |Sept 2008  |31 Dec 2008  | previous  |        | 
|          |            |            |             |           |             |valuation  |        | 
+----------+------------+------------+-------------+-----------+-------------+-----------+--------+ 
| Mall     |    10.6    |    19.2    |    29.8     |   31.6    |    27.9     |  (3.7)    |(11.7)  | 
| Veliko   |            |            |             |           |             |           |        | 
| Turnovo  |            |            |             |           |             |           |        | 
+----------+------------+------------+-------------+-----------+-------------+-----------+--------+ 
* including transaction costs 
 
 
The result of this revaluation on the net assets per share of the Company, 
excluding other factors, will be a reduction of 0.06 Euro from the published NAV 
as at 30 June 2008, which would result in a NAV per share of EUR0.195. It should 
be noted that this calculation is for illustrative purposes only and may differ 
from the actual current NAV. 
 
 
The Company's interim results to 31 December 2008, which will be announced in 
March, will reflect this valuation and will include an updated and unaudited NAV 
per share. 
 
 
The valuation of the Company's remaining property asset is based on a number of 
estimates and assumptions concerning future events which may or may not prove 
correct. 
 
 
In Bulgaria, as worldwide, the outlook for the economic environment and local 
credit markets remains uncertain. Given the importance of debt to the valuation 
of property assets, changes in the debt market over the coming months may have 
material effects on the Company's valuation. 
 
 
 
 
For further information please contact: 
 
 
+-------------------------------------------+------------------+ 
| Charlemagne Capital                       | +44 (0)207 518   | 
|                                           | 2100             | 
+-------------------------------------------+------------------+ 
| Varda Lotan / Christopher Fitzwilliam Lay |                  | 
+-------------------------------------------+------------------+ 
|                                           |                  | 
+-------------------------------------------+------------------+ 
| Galileo Fund Services Limited             | +44 (0)1624      | 
|                                           | 692600           | 
+-------------------------------------------+------------------+ 
| Ian Dungate, Company Secretary            |                  | 
+-------------------------------------------+------------------+ 
|                                           |                  | 
+-------------------------------------------+------------------+ 
| Panmure Gordon (UK) Limited               | +44 (0)20 7459   | 
|                                           | 3600             | 
+-------------------------------------------+------------------+ 
| Hugh Morgan                               |                  | 
+-------------------------------------------+------------------+ 
| Stuart Gledhill                           |                  | 
+-------------------------------------------+------------------+ 
|                                           |                  | 
+-------------------------------------------+------------------+ 
| Smithfield Consultants                    | +44 (0)20 7360   | 
|                                           | 4900             | 
+-------------------------------------------+------------------+ 
| John Kiely                                |                  | 
+-------------------------------------------+------------------+ 
| Gemma Froggatt                            |                  | 
+-------------------------------------------+------------------+ 
 
 
www.europeanconvergence.com 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
 STREAKANEFSNEFE 
 

European Convergence (LSE:ECPC)
Gráfico Histórico do Ativo
De Mai 2024 até Jun 2024

European Convergence (LSE:ECPC)
Gráfico Histórico do Ativo
De Jun 2023 até Jun 2024