Cibus Nordic Real Estate AB (publ) moves into Sweden, announces intention to acquire a property portfolio with supermarkets from Coop and obtains new financing
INSIDER INFORMATION: Cibus Nordic Real Estate AB (publ) ("Cibus" or the "Company") is on the verge of completing its first acquisition in Sweden with its intention to acquire a property portfolio consisting of 111 supermarkets, with a property value of approximately SEK 1,900 million, from Coop (the "Transaction"). The properties are located in southern and central Sweden and are rented out with new ten-year triple net agreements with Coop as the tenant. The rentable area amounts to approximately 118,000 square meters. The property portfolio was part of Coops acquisition of Netto's Swedish business during 2019. Cibus and Coop intend to enter into a binding agreement regarding the acquisition prior to the commencement of trading on Nasdaq First North Premier Growth Market on 5 March 2020, conditioned upon the Company's financing being secured through a directed share issue carried out by way of an accelerated book building procedure, which will be announced through a separate press release in connection herewith. Closing of the Transaction is estimated to take place on 10 March 2020.
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The Transaction in brief
- The property value of the Transaction amounts to approximately SEK 1,900 million which will be paid in cash in its entirety in connection with the closing, which is estimated to take place on 10 March 2020.
- When the transaction agreement is entered into (which is estimated to occur prior to the commencement of trading on Nasdaq First North Premier Growth Market on 5 March 2020) there will be no remaining conditions for the completion of the Transaction.
- The Transaction is Cibus' first acquisition in Sweden and is in line with the Company's communicated strategy to increase its property holdings in new geographic areas.
- Financing of the Transaction consists of a combination of external financing and funds from a directed share issue intended to be carried out by way of an accelerated book building procedure, which will be announced through a separate press release in connection herewith.
"We are very happy to have this opportunity to move into Sweden. The negotiations with Coop have been very constructive and we have agreed on a triple net arrangement which makes this transaction unique in Sweden. We are accustomed to the triple net arrangement from our Finnish portfolio and we are pleased that Coop agrees with us regarding the benefits this arrangement brings for both parties. The transaction is strategically important for us since the properties are relatively newly built and purely built as good-sized supermarkets and we can now continue our successful strategy of acquiring single properties and portfolios that complement this transaction in a new geographic area. We look forward to a long and successful partnership with Coop, who is a large and serious player who focuses on the customer and has a clear sustainability perspective, which are important points for us.", says Sverker Källgården, CEO of Cibus.
Background and reasons
Cibus is an active real estate company whose business idea is to acquire, develop and manage high quality properties in the Nordics with a clear orientation towards food and grocery trade. Cibus current property portfolio is spread out across strategically sound locations, mainly in the southern and southwestern Finland and the properties are for the most part located in regions with strong population growth. The Company is specialized in properties with tenants who operate in the food and grocery trade, who in general have two main features that separate them from other types of commercial properties. These features are the business' resistance to economic cycles and negative effects of e-commerce. The portfolio also constitutes a natural distribution network ideal for mail and other services, which is an advantage considering the trend within e-commerce. These qualities entail higher stability and lower risk compared to other commercial properties. The Company strives to create high dividends that is not affected by economic cycles for its shareholders. This is achieved through a stable profitability in the underlying property portfolio. Properties with tenants who operate in the food and grocery trade are generally owned by institutions, food and grocery stores or a joint venture between the two. Cibus contributes to a responsible development of society by working together with its tenants to create readily available and climate-smart solutions.
The Coop portfolio consists of 111 supermarkets, which were a part of the acquisition of Netto's Swedish business during 2019. The rentable surface amounts to approximately 118,000 square meters and the rent income amounts to EUR 10.6 million per year. In connection with the transaction Cibus will enter into ten-year triple net agreements with Coop.
The Transaction results in Cibus expanding geographically and establishing a significant presence in southern and central Sweden which is in line with the Company's communicated strategy. The property portfolio's size leads to Cibus being able to, in a cost efficient manner, continue to execute its strategy to acquire single properties to complement the Transaction in Sweden. Through the Transaction, Cibus property portfolio amounts to 253 properties valued at approximately EUR 1,055 million. Cibus assesses that the Transaction, considering its size and geographical location, entails increased visibility for the Company in regards to customers, creditors and investors.
Key performance indicator table[1]
KPIs |
Cibus pre-transaction (FY19) |
Coop-portfolio |
Cibus post-transaction |
Total area (m2) |
506,000 m2 |
118,000 m2 |
624,000 m2 |
Properties (#) |
142 |
111[2] |
253 |
Net rental income (EURm) |
EUR 50.9m |
EUR 10.6m |
EUR 61.5m |
Net rental income per m2 (EUR) |
EUR 100.6 |
EUR 92.8 |
EUR 98.5 |
WAULT (years) |
4.9 years |
10.0 years |
5.5 years |
Vacancy (%) |
5.3% |
0.0% |
4.4% |
NOI-margin (%) |
94.3% |
100.0% |
95.3% |
Investment properties (EURm) |
EUR 875m |
EUR 180m |
EUR 1,055m |
Implied yield based on share price (%) |
5.3% |
5.9% |
5.4% |
An investor presentation regarding Cibus and the Transaction which includes, inter alia, information about the property portfolio and the Transaction is attached to this press release and will be published on Cibus' webpage, www.cibusnordic.com.
Property value and payment of the purchase price
- The property value in the Transaction amounts to approximately SEK 1,900 million, which corresponds to the purchase price on a cash and debt free basis.[3]
- The purchase price for the shares in the property companies shall be paid in its entirety in cash in connection with the closing, which is estimated to take place on 10 March 2020.
Conditions for completion of the Transaction
The Company will enter into a binding acquisition agreement which will be unconditional prior to the commencement of trading on Nasdaq First North Premier Growth Market on 5 March 2020 provided that a directed share issue, which the Company will announce in connection herewith, is successful.
The Transaction is otherwise not subject to any conditions.
Financing
The Transaction is intended to be financed by way of a combination of funds from the directed share issue, as mentioned above, together with additional external financing.
The external financing consists of credit facilities that the Company today has entered into with Swedbank, amounting to approximately SEK 1,300 million.
Timeplan for completion of the Transaction
- 4-5 March: signing of unconditional acquisition agreement as well as completion of the directed share issue
- 10 March: closing and payment
Advisors
Pareto Securities AB and Swedbank AB (publ) (together the "Managers") are acting as financial advisors in relation to the directed share issue and the book building procedure. Roschier Advokatbyrå AB is acting as legal advisor to the Company in relation to the directed share issue and the Transaction. Baker & McKenzie Advokatbyrå KB is acting as legal advisor to the Managers in relation to the directed share issue and the book building procedure.
Responsible person
This information is such information Cibus Nordic Real Estate AB (publ) is obliged to make public in accordance with the (EU) Market Abuse Regulation. The information in this press release has been made public through the agency of the responsible person as set out below for publication at the time stated by Cibus' news distributor, beQuoted, at the publication of this press release. The person below may be contacted for further information.
[1] All of the KPIs are unaudited.
[2] The property portfolio consists of 110 properties and land leases, three leases (of which two are building on restricted grounds) as well as a cooperative locale. For the avoidance of doubt, the property portfolio consists of 111 supermarkets across 114 properties.
[3] The actual purchase price for the shares will depend on the capital structure the seller has in place at the closing and has been estimated to approximately SEK 1,000 million.
For additional information, please contact:
Sverker Källgården, CEO
[email protected]
+46 761 444 888
About Cibus Nordic Real Estate AB (publ)
Cibus is a real estate company listed on Nasdaq First North Premier Growth Market in Stockholm. The Company's business idea is to acquire, develop and manage high quality properties in the Nordics with daily goods store chains as anchor tenants. The Company currently owns approximately 140 properties in Finland. The main tenants are Kesko, Tokmanni and S-Group. FNCA Sweden AB, +46 (0) 8-528 00 399 [email protected], is appointed Certified Adviser.
Important information
The release, announcement or distribution of this press release may, in certain jurisdictions, be subject to legal restrictions. The recipients of this press release in such jurisdictions, in which this press release has been released, announced or distributed, should inform themselves of and follow such legal restrictions. The recipient of this press release is responsible for using this press release, and the information contained herein, in accordance with applicable rules in each jurisdiction. This press release does not constitute an offer, or a solicitation of any offer, to sell, acquire or subscribe for any securities issued by the Company in any jurisdiction where such offer or solicitation of offer would be unlawful or would require registration or any other measures.
This press release does not constitute or form part of an offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein may not be sold in the United States absent registration or an exemption from registration under the US Securities Act of 1933 (the "Securities Act"), as amended, and may not be offered or sold within the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States. The information in this press release may not be announced, published, copied, reproduced or distributed, directly or indirectly, in whole or in part, within or into, Australia, Canada, Hong Kong, Japan, New Zealand, Singapore, South Africa, Switzerland, the United States or in any other jurisdiction where such announcement, publication or distribution of the information would not comply with applicable laws and regulations or where such actions are subject to legal restrictions or would require additional registration or other measures than what is required under Swedish law. Actions taken in violation of this instruction may constitute a crime against applicable securities laws and regulations.
This announcement is not a prospectus for the purposes of Regulation (EU) 2017/1129 (the "Prospectus Regulation") and has not been approved by any regulatory authority in any jurisdiction. The Company has not authorized any offer to the public of securities in any member state of the EEA and no prospectus has been or will be prepared in connection with the directed share issue. In any EEA Member State, this communication is only addressed to and is only directed at "qualified investors" in that Member State within the meaning of the Prospectus Regulation.
In the United Kingdom, this press release and any other materials in relation to the securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, "qualified investors" (within the meaning of Article 86(7) of the Financial Services and Markets Act 2000) who are (i) persons having professional experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); or (ii) "high net worth entities" falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "relevant persons"). In the United Kingdom, any investment or investment activity to which this communication relates is available only to, and will be engaged in only with, relevant persons. Persons who are not relevant persons should not take any action on the basis of this press release and should not act or rely on it.
This press release does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the new shares. Any investment decision to acquire or subscribe for new shares in connection with the directed share issue must be made on the basis of all publicly available information, which has not been independently verified by the Managers. The Managers are acting for the Company in connection with the transaction and no one else. The Managers will not be responsible to anyone other than the Company for providing the protections afforded to its clients nor for giving advice in relation to the transaction or any other matter referred to herein.
This press release does not constitute a recommendation concerning any investor's option with respect to the directed share issue. Each investor or prospective investor should conduct his, her or its own investigation, analysis and evaluation of the business and information described in this press release and all publicly available information. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. Neither the contents of the Company's website nor any other website accessible through hyperlinks on the Company's website are incorporated into or form part of this press release.
Failure to comply with these instructions may result in a violation of the Securities Act or applicable laws in other jurisdictions.
Forward-looking statements
This press release contains forward-looking statements that relate to the Company's intentions, assessments or expectations regarding the Company's future results, financial position, liquidity, development, prospects, expected growth, strategies and opportunities and the markets in which the Company operates. Forward-looking statements are statements that do not refer to historical facts and can be identified through statements which includes, but is not limited to, terms such as "consider", "expects", "anticipates", "intends", "appreciates", "will", "can", "assumes", "should", "could" and, in any case, negations thereof, or similar expressions. The forward-looking statements in this press release are based on various assumptions, which in many cases are based on additional assumptions. Although the Company considers that the assumptions reflected in these forward-looking statements are reasonable, it cannot be guaranteed that the assumptions will occur or that they are correct. Since these assumptions are based on assumptions or estimates and are subject to risks and uncertainties, the actual result or outcome may, for many different reasons, differ materially from the forward-looking statements. Such risks, uncertainties, eventualities and other significant factors may cause actual events to deviate significantly from the expectations expressly or implicitly stated in this press release through the forward-looking statements. The Company does not guarantee that the assumptions underlying the forward-looking statements in this press release are correct and the recipients of this press release should not unduly rely on the forward-looking statements in this press release. The information, perceptions and forward-looking statements expressly or implicitly set forth herein are provided only as of the date of this press release and may change. Neither the Company nor anyone else undertakes to review, update, confirm or publicly announce any revision of any forward-looking statement to reflect events or circumstances that occurs relating to the content of this press release.
Information to distributors
Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the shares in Cibus have been subject to a product approval process, which has determined that such shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, distributors should note that: the price of the shares in Cibus may decline and investors could lose all or part of their investment; the shares in Cibus offer no guaranteed income and no capital protection; and an investment in the shares in Cibus is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the directed share issue.
For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the shares in Cibus.
Each distributor is responsible for undertaking its own target market assessment in respect of the shares in Cibus and determining appropriate distribution channels.
Om Cibus
Cibus affärsidé är att förvärva, förädla och utveckla högkvalitativa fastigheter i Norden med välrenommerade livsmedelsbutiker och dagligvarukedjor som ankarhyresgäster för att kunna ge en stabil, konjunkturoberoende och ökande utdelning till våra aktieägare.
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