Elbit Imaging Signs a Definitive Agreement for the Sale of its Rights in the Radisson Hotel Complex in Bucharest, Romania
TEL AVIV, ISRAEL / ACCESSWIRE / November 29, 2017 / Elbit Imaging Ltd. ("EI" or the "Company") (TASE: EMITF, NASDAQ: EMITF) announced today, further to its previous announcements dated November 23, 2017, November 8, 2017 and August 18, 2017 respectively, that its wholly owned indirect subsidiary (the "Vendor") has signed a definitive sale and purchase agreement (the "Agreement") for the sale of its entire shareholding (comprising approx. 98.2% of the outstanding share capital) in the company (the "SPV") which owns the Radisson Hotel Complex in Bucharest, Romania, based on a property value of €169.2 million (the "Transaction"). The Agreement has been signed with an acquisition vehicle jointly owned by two international investment funds (the "Purchaser").
The consummation of the Transaction, which is expected to occur during the month of December 2017, is subject to the fulfillment of a conditions precedent, namely the obtaining by the Purchaser of externally sourced financing.
The estimated net proceeds to be derived from the Transaction (after offsetting the SPV's senior bank loan, working capital and other adjustments, as well as transaction expenses) is expected to be approximately €81 million. Part of the net proceeds equal to €8 million will be used to finance a vendor loan which has been granted for a period of 3 years, bearing interest at the rate of 5% per annum (the "Vendor Loan").
The Vendor Loan will act as collateral for customary post-closing liabilities of the SPV, whereby the Purchaser may offset adjudicated losses which may be incurred by it as a result of a breach of warranties or in respect of certain indemnities given by the Vendor in terms of the Agreement. Additionally, the Company has granted a letter of guarantee in favour of the Purchaser pursuant to which it has undertaken to fulfill the Vendor's undertakings and obligations under the Agreement (if and to the extent that the Vendor fails to do so). At this stage, there can be no certainty that the condition precedent will be met in a timely manner, or that the Transaction will be successfully consummated.
The Company is being exclusively advised by JLL's Hotels & Hospitality Group in London and JLL in Bucharest.
