Elbit Imaging Announces Update Regarding a Possible Forward Sale Transaction of Belgrade Plaza (Visnjicka) by Its Subsidiary, Plaza Centers
TEL AVIV, Israel, Nov. 03, 2016 (GLOBE NEWSWIRE) -- Elbit Imaging Ltd. (“EI” or the “Company”) (EMITF) (EMITF) announced today, in further to its announcement dated on October 26, 2016, that Plaza Centers N.V. ("Plaza") (PLAZ.L), an indirect subsidiary (45%) of the Company, has signed a new non-binding Letter of Intent (“LOI”) with BIG Shopping Centers Ltd., a public company listed in the Tel Aviv Stock Exchange (“TASE”) and included in the TA 100 Index (the top 100 companies traded on the TASE), (the “Purchaser”) regarding a possible forward sale of Belgrade Plaza shopping and entertainment center (“Belgrade Plaza”) in Belgrade, Serbia.
The LOI binds the Purchaser to a strict timeline for committing a comprehensive Due Diligence and finalizing a detailed binding agreement which determines that the transaction should be concluded by the end of the year. Should the transaction proceed to a signed share purchase agreement, following the due diligence process, Plaza will receive up to €28 million from the Purchaser upon the signing of the agreement as a first installment, and will be due further payments during the first year of operation, subject to certain targets and milestones fulfillment. The Purchaser will provide a guarantee to secure such further payments.
The final agreed value of Belgrade Plaza will be calculated based on a cap rate of 8.25% and the sustainable NOI after 12 months of operation (estimated NOI by the Company at that time stage is approximately €7.5 million per year). Plaza has a line of credit from a financing bank for the development of Belgrade Plaza in a maximum amount of €42 million.
While it is expected that the disposal of Belgrade Plaza will be finalized in the fourth quarter of this year, at this stage there is no certainty that the transaction will be completed.
The Company will update regarding any new developments.
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