Grand City Properties S.A. Announces Exchange Offer with 15% Tender Option for Perpetual Note Holders

Grand City Properties S.A., a prominent real estate entity, declared the initiation of a unique exchange and tender offer aimed at the holders of its two outstanding Euro-denominated perpetual notes. This offer grants the note holders the choice to either swap their existing notes for new ones coupled with a cash incentive or opt for a 15% cash redemption of their exchanged notes.

The specific notes targeted by this offer are identified by the ISIN codes XS1491364953, with a current 6.332% coupon, and XS1811181566, bearing a 5.901% coupon. The proposal entails exchanging these for new subordinated notes carrying a coupon rate of 6.125% for a six-year term until the first reset date. The issuance of these new notes, anticipated to be rated BBB- by S&P Global Ratings Europe Limited, is contingent upon reaching a minimum issuance volume of EUR 150,000,000.

Launching on 2 April 2024, the offer period is slated to conclude on 9 April 2024, notwithstanding any possible extensions or amendments by Grand City Properties. The issuance and guaranteed backing of the new subordinated notes will be managed by a subsidiary, Grand City Properties Finance S.à r.l., ensuring they rank equally with other subordinated notes issued or guaranteed by the company. Moreover, these notes are destined for listing on the Luxembourg Stock Exchange's official list and will be tradeable on its MTF Market.

This strategic move is part of Grand City Properties' efforts to rehabilitate the equity content under S&P rating methodology for perpetual notes not redeemed on their first call dates. Detailed conditions and specifics about the offer will be provided in the Exchange and Tender Offer Memorandum.