PTA-News: conwert Immobilien Invest SE: Extraordinary General Meeting to decide on the composition of the Administrative Board

2/25/2016, 8:30 AM (Source: pressetext)
Vienna (pta009/25.02.2016/08:30) - - + ADLER Real Estate wants to gain control of the Administrative Board of conwert through an Extraordinary General Meeting + Control of the Administrative Board by the competitor Adler could lead to considerable disadvantages for other conwert shareholders + conwert recommends that its shareholders vote against the resolutions proposed by Adler

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Vienna (pta009/25.02.2016/08:30) - -
+ ADLER Real Estate wants to gain control of the Administrative Board of conwert through an Extraordinary General Meeting
+ Control of the Administrative Board by the competitor Adler could lead to considerable disadvantages for other conwert shareholders
+ conwert recommends that its shareholders vote against the resolutions proposed by Adler

An Extraordinary General Meeting of conwert will be held in Vienna on March 17. conwert is required to convene this Extraordinary General Meeting due to a request by the minority shareholder MountainPeak Trading Ltd, a subsidiary of competitor ADLER Real Estate ("Adler").
Adler intends to replace three of the current four independent Administrative Board members by own nominees. Adler also intends to reduce the number of Administrative Board seats from five to four. With these proposals, Adler is clearly seeking to gain control of the Administrative Board and thus of conwert itself. conwert therefore considers this to be a hostile action against the company and a majority of its shareholders.

In the event that Adler was to gain control, all significant business decisions of conwert could be dominated by its competitor Adler. Adler could therefore push for a combination of the two companies, e.g. through the transfer of assets. After intensive analyses, the Administrative Board and the management of conwert clearly came to the conclusion that this is not in the interest and not for the benefit of all shareholders of conwert and should therefore be rejected.

Adler tries to justify its request for the replacement of the Administrative Board members by a number of arguments which have no substance at all:

+ Inadequate Board experience: This argument is completely invalid. The current Administrative Board members are independent, as opposed to the candidates nominated by Adler. They have proven track records in the fields of real estate, capital markets, corporate governance and conwert's core markets Germany and Austria.
+ Acceleration of non-core disposals: With EUR 234 million of non-core disposals above book value in 2015, conwert has already successfully demonstrated its abilities in this field and confirms its guidance of EUR 300 million - EUR 350 million in non-core sales for 2016.
+ Cost reduction: Here, Adler omits the fact that the Administrative Board and the management of conwert have started a restructuring programme last year which will reduce the cost by 20%.
+ No bond placement, resulting in financial damage to the company: The average financing cost of bonds have been between 70 to 80 basis points higher than secured real estate financing since autumn 2015; therefore a bond issue would have been highly detrimental to the FFO I.
+ conwert to develop as dynamically as Adler: Adler has a loan to value ratio (LTV) of approximately 67%, far above conwert's LTV of 48% (following the industry definition without goodwill, Adler's LTV would be well above 70%). Adler's vacancy rate of 11.9% is also significantly higher than that of conwert (6.6%). The same applies to the average cost of debt with conwert being at 2.3% and Adler at around 4.0%.

All these reasons are clearly just put forward to disguise Adler's attempt to control the conwert Board and thus the company itself with the danger of subsequent related party transactions.

The strategic measures introduced by the Administrative Board of conwert are successful. conwert is profitable and solidly financed. conwert therefore confirms again its FFO 1 guidance of EUR 65 million for 2016. Any gain of control over conwert by Adler would be to the detriment of the vast majority of conwert shareholders. For these reasons, conwert recommends that its shareholders vote against the resolutions proposed by the MountainPeak or Adler at the Annual Meeting.

If a shareholder is unable to personally attend the Extraordinary General Meeting, he may assign his vote to the company. More information about the Extraordinary General Meeting is available here http://www.conwert.com.

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This release contains forward-looking estimates and statements that were made on the basis of the information available at this time. Forward-looking statements reflect the point of view at the time they are made. We would like to point out that the actual circumstances and, consequently, the actual results realised at a later date may differ from the forecasts presented here for a variety of reasons.

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emitter: conwert Immobilien Invest SE
address: Alserbachstraße 32, 1090 Vienna
country: Austria
contact person: Clemens Billek
phone: +43 1 52145-700
e-mail: cwi@conwert.at
website: www.conwert.at

ISIN(s): AT0000697750 (share)
stock exchanges: official trade in Vienna

[ source: http://www.pressetext.com/news/20160225009 ]