NEPI Rockcastle deal falls through

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NEPI Rockcastle deal falls through

Published Date: 2019-01-07 | Source: Stephen Gunnion | Author: Stephen Gunnion | Comments

NEPI Rockcastle deal falls through

Regulatory approvals and the waiver of a right of first refusal weren't met by the end-December deadline.

NEPI Rockcastle says a deal to buy two shopping centres in Poland fell through after some of the conditions weren't met by the end-2018 deadline.

In a statement after the market close on Friday, the Central and Eastern European property investor said the required regulatory approvals and the waiver of a right of first refusal weren't fulfilled, resulting in the agreement to buy the Serenada and Krokus shopping centres in Kraków. The deal was being conducted through its wholly-owned subsidiary, Tuvalu, and would have cost an initial €294.4 million with future payments of €212 million, dependent on the completion of an extension that would join the two adjacent centres. The right of first refusal to acquire the shopping centres had been granted to a tenant of Centrum Krokus under the terms of its existing lease agreement.

The deal would have met NEPI's strategy to buy and develop dominant retail centres in Central and Eastern European cities with attractive macroeconomic fundamentals. It aims consolidate its position as one of the largest dominant retail owners in Poland, the most populous country in the region.

The property owner came under pressure late last year after activist short-seller Viceroy released a report accusing it of fraud and manipulation of its accounts, including inflating its profits. It has denied any wrongdoing.

It also reconfirmed its earnings guidance and distribution growth for its 2018 financial year in Friday's announcement.

Its shares closed 1.1% up at R114.





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