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| Financial News | Details | |||
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| PALM HILLS DEVELOPMENTS S.A.E. INTENTION TO FLOAT | |||
| 7 April 2007 | |||
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OFFERING AND LISTING ON THE LONDON STOCK EXCHANGE PLANNED FOR MAY 2008 Palm Hills Developments S.A.E. (“PHD” or the “Company”), a leading real estate developer in the Egyptian market, today announces its intention to conduct a global offering (“the Global Offering”) of ordinary shares (“Shares”) and global depositary receipts (“GDRs”) and to apply for admission of the Shares to trading on the Cairo and Alexandria Stock Exchange (the "CASE") and for the admission of the GDRs to the Official List of the U.K. Financial Services Authority and to trading on the London Stock Exchange plc (“LSE”). The Global Offering is expected to close in May 2008. About the Company • PHD is a leading real estate developer in the Egyptian market, developing primarily high-end residential real estate and resort projects. The origins of the Company date back to 1997 through the operations of its sister company Al Ethadia. PHD’s controlling shareholder is El Mansour and El Maghraby for Investment & Development S.A.E. (“MMID”) which owns approximately 66 per cent. of the Company. MMID is an Egyptian joint stock company established in 1996 by the El Mansour Group and the El Maghraby Group. • The market value of PHD’s properties as at 1 March 2008 has been independently valued by CB Richard Ellis (CBRE) at LE 19.5 billion (US$3.5 billion), prior to adjustments for tax, minority interests and land repayment obligations. In the year ended 31 December 2007, the Company generated revenues of LE 535.0 million (US$96.7 million) and net profits LE 179.8 million (US$32.5 million). • The Company has acquired large parcels of land in strategic locations throughout Egypt and has one of the largest land banks held by any developer operating in the Egyptian market consisting of over 37.7 million square metres of land. Of the Company’s 22 projects, five are under construction and a further 12 have already been master planned. • Development land locations include: Cairo's West axis in 6th of October City; Cairo's East axis in New Cairo City; the North Coast on the Mediterranean Sea; the City of Alexandria; and the Red Sea Coast in different locations. • PHD is currently constructing or designing seven residential projects, covering approximately 12.0 million square metres. These projects feature a variety of residential units and have been designed to meet demand in the Egyptian market for high-quality, prestigious housing of varying sizes and styles. These projects are designed as "gated communities" that include the requisite supporting infrastructure, landscaping, common areas and security services. • A further five residential resort projects, covering approximately 9.3 million square metres, are currently being constructed or designed by PHD. These projects are designed to respond to increasing demand, both from Egyptians and from abroad, for high-quality second homes and resort accommodation. Amongst these projects, Hacienda Bay comprises over 2.3 million square metres of land located on Egypt's North Coast and, upon completion, is expected to feature a variety of residential units, five-star hotels, a health spa and a private 18-hole golf course, as well as numerous dining and entertainment facilities. These projects also include properties on the Egyptian coast of the Red Sea that Palm Hills intends to develop as residential resort projects. • The Company is also constructing or designing five mixed-use projects covering approximately 0.9 million square metres. These projects will include a mixture of residential and commercial properties. For example, "The Village", which is situated near to the American University campus in New Cairo, is designed to include quality apartments suitable for students, young professionals and young families, as well as a large retail mall designed to attract residents of the development, students from the nearby campus and others in the same age group. • PHD intends to use the net proceeds received by it from the Global Offering to fund existing and future development projects and to expand its land bank both in Egypt and abroad. The Global Offering The Global Offering consists of an offering to institutions internationally and in Egypt. EFG Hermes and Goldman Sachs International have been appointed Joint Global Coordinators and Joint Bookrunners of the Global Offering. A separate retail offering will be conducted in Egypt. This announcement does not relate to such Egyptian retail offering. Further details and announcements of the Global Offering including regarding timing and sizing will follow in due course. Comment Commenting on today’s announcement, Yasseen Mansour, Chairman and Chief Executive Officer of the Company said: “Palm Hills is one of Egypt’s leading real estate developers and is well positioned to exploit the strong economic and demographic fundamentals in Egypt. The Company has an excellent reputation and a brand associated with quality and reliability. The Global Offering will enable us to expand this reputation and provide capital to pursue further strategic land acquisition opportunities in Egypt and abroad.” For further information please contact: Weber Shandwick Financial (London) James Chandler/Terry Garret/Stephanie Badjonat/James White Tel: +44 (0)207 067 0700 Weber Shandwick Financial (Cairo) Randa Nassar Tel +20101022716 NOTES TO EDITORS Company History The Company has its origins in 1997 with the formation of Al Ethadia for Real Estate Investment S.A.E. ("Al Ethadia"), which was established for the purpose of developing the "Palm Hills 6th of October" residential development in 6th of October City on the west axis of Cairo. The success of that initial project led to Al Ethadia acquiring more land around 6th of October City. By 2005 Al Ethadia had sold over 450 luxury villas and townhouses in the first five stages of the Palm Hills 6th of October project and completed the development of approximately 535,000 square metres in that area, representing stages one to three of the project. In conjunction with its development of Palm Hills 6th of October, Al Ethadia also designed and developed The Club, a sports and social venue that offers training academies, including one associated with Barcelona Football Club, a health spa and several restaurants. In January 2005, the shareholders of Al Ethadia established PHD under the Egyptian Investment Law in order to take advantage of a favourable tax regime available to companies organised under that law. Since the formation of the Company, Al Ethadia's business has been limited to completing the remaining stages of the Palm Hills 6th of October development. Stages one through three of Palm Hills 6th of October were completed in 2005, and stages four and five are expected to be completed by the end of 2008. Accordingly, the time allocated by Al Ethadia's management and staff to the completion of those projects has declined over time, coinciding with an increase in the scope of the development activity undertaken by Palm Hills. No offer or invitation to purchase or subscribe for Shares or GDRs in the Company is being made at this time. The contents of this announcement, for which Palm Hills Developments S.A.E. (the "Company") is solely responsible, have been approved by Goldman Sachs International, which is authorised and regulated in the United Kingdom by the Financial Services Authority, solely for the purposes of Section 21(2)(b) of the United Kingdom Financial Services and Markets Act 2000 (“FSMA”). Each of EFG-Hermes Promoting & Underwriting and Goldman Sachs International (together, the "Joint Global Coordinators") is acting exclusively for the Company and no one else in relation to the proposed offer of the Company’s securities and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients nor for giving advice in relation to the proposed offer or any other matters referred to in this announcement. Apart from the responsibilities and liabilities, if any, which may be imposed on EFG-Hermes Promoting & Underwriting or Goldman Sachs International by FSMA or the regulatory regime established thereunder, each of EFG-Hermes Promoting & Underwriting and Goldman Sachs International accepts no responsibility whatsoever for the contents of this announcement, including its accuracy, completeness or verification, or for any other statement made or purported to be made by it, or on its behalf, in connection with the Company, the Shares or GDRs or the proposcd offer. EFG-Hermes Promoting & Underwriting and Goldman Sachs International accordingly disclaim all and any liability whether arising in tort, contract or otherwise (save as referred to above) which they might otherwise have in respect of this announcement or any such statement. The offering and the distribution of this announcement and other information in connection with the offering may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with any such restriction may constitute a violation of the securities laws of any such jurisdiction. The information contained herein is restricted and is not for publication, distribution or release, directly or indirectly, in or into the United States of America, Canada, Australia or Japan. This announcement does not constitute or form part of any offer to sell or solicitation of an offer to purchase or subscribe for securities in the United States. The securities referred to herein have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States or to US persons unless the securities are registered under the Securities Act, or an exemption from the registration requirements of the Securities Act is available. No public offering of the securities will be made in the United States. This announcement and any offer mentioned herein if made subsequently are only addressed to and directed at persons in member states of the European Economic Area who are "qualified investors" within the meaning of Article 2(1)(e) of the Prospectus Directive (Directive 2003/71/EC) ("Qualified Investors"). In addition, in the United Kingdom, this announcement is being distributed only to, and is directed only at, (i) Qualified Investors who have professional experience in matters relating to investments who fall within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") and Qualified Investors falling within Article 49(2)(a) to (d) of the Order, and (ii) Qualified Investors to whom it may otherwise lawfully be communicated (all such persons together being referred to as "relevant persons"). This announcement must not be acted on or relied on (i) in the United Kingdom, by persons who are not relevant persons, and (ii) in any member state of the European Economic Area other than the United Kingdom, by persons who are not Qualified Investors. Any investment or investment activity to which this announcement relates is available only to (i) in the United Kingdom, relevant persons, and (ii) in any member state of the European Economic Area other than the Untied Kingdom, Qualified Investors, and will be engaged in only with such persons. This communication includes “forward-looking statements.” All statements other than statements of historical facts included in this communication, including, without limitation, those regarding the Company’s financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives) are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company’s present and future business strategies and the environment in which the Company will operate in the future. These forward-looking statements speak only as of the date of this announcement. The Company expressly disclaims any obligations or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any changes in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. In connection with the proposed offer, one of EFG-Hermes Promoting & Underwriting and Goldman Sachs International will act as stabilising manager (the "Stabilising Manager") and the Stabilising Manager or any of its agents, may (but will be under no obligation to), to the extent permitted by law, over-allot and effect other transactions intended to enable it to satisfy any over-allotments or which stabilise, maintain or otherwise affect the market price of the Shares or GDRs or any other options, warrants or rights with respect to, or interests in the Shares or GDRs or other securities of the Company, in each case at levels which might not otherwise prevail in the open market. The Stabilising Manager is not required to enter into such transactions and such transactions may be effected on the CASE or the LSE and any other securities market, over the counter market or otherwise. Such transactions, if commenced, may be discontinued at any time and may only be entered into between commencement of trading of the Shares on the CASE and the GDRs on the LSE and 30 days thereafter. Neither the Stabilising Manager nor any of its agents intends to disclose the extent of any over-allocations and/or stabilisation transactions under the proposed offer otherwise than in accordance with any legal or regulatory obligation to do so in Egypt, the United Kingdom or otherwise. In connection with the proposed offer, the Stabilising Manager may, for stabilisation purposes, over-allot Shares or GDRs up to an aggregate maximum of 15 per cent. of the total number of Shares (in the form of Shares or GDRs) comprised in the proposed offer. For the purposes of allowing it to cover such over-allotments and/or sales of Shares or GDRs effected by it during the stabilisation period, the Stabilising Manager will enter into over-allotment arrangements with MMID (and potentially other selling shareholders) pursuant to which the Stabilising Manager may purchase or procure purchasers for additional Shares (in the form of Shares or GDRs) up to a maximum of 15 per cent. of the total number of Shares (in the form of Shares or GDRs) comprised in the proposed offer (the "Over-allotment Shares") at the offer price, such option to be exercised prior to the closing of the Offer. As part of these arrangements, on or prior to the closing date, MMID (and any relevant other selling shareholders) will open an investment account (the "Account") and will deposit the net proceeds from the sale of the Over-allotment Shares in the Account and will grant to the Stabilising Manager, on behalf of the Joint Global Coordinators, exclusive discretionary authority to undertake stabilisation activities with the proceeds contained in the Account for the period described above. During that period, the Stabilising Manager, on behalf of the Joint Global Coordinators, may use the funds in the Account to engage in transactions also as described above and at the end of such period will return the remaining proceeds contained in such account (or Shares or GDRs, as appropriate) to MMID (and any relevant other selling shareholders). Any Over-allotment Shares made available pursuant to the over-allotment arrangements will rank pari passu in all respects and will be purchased on the same terms and conditions as the Shares (in the form of Shares or GDRs) being sold in the proposed offer and will form a single class for all purposes with the other Shares or GDRs, as the case may be. Information in this communication cannot be relied on as a guide to future performance. The price and value of the securities can go down as well as up. Persons needing advice should contact a professional adviser. |
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