KARDAN REACHES UNDERSTANDING WITH DEBENTURE HOLDERS
Amsterdam, January 13, 2013 – Kardan N.V. (“Kardan”), active in Real Estate, Water Infrastructure and Financial Services in emerging markets announces, following publication in the newspapers in Israel, that it has come to understandings with representatives of the trustees and several representatives of holders of its Debentures Series A and Debentures Series B (combined “the Debentures”) on certain concessions, which are still subject to Board approval and approval of Debentures Holder meetings.
During 2007 and 2008, Kardan N.V. issued two series of debentures listed on the Tel Aviv Stock Exchange: Debenture Series A with a par value of NIS 1,190 million (EUR 242 million as at December 31, 2012) and Debenture Series B with a par value of NIS 1,334 million (EUR 271 million as at December 31, 2012). Repayment of Series A commences in February 2013 (4 annual equal installments) and of Series B in February 2014 (7 annual equal installments).
As at December 31, 2012, following repurchases of the Debentures by Kardan, 52.5% (approximately EUR 156 million) of Debentures A is still outstanding and 87.4% (EUR 292 million) of Debentures B.
Following various meetings between Kardan and the Trustees of the Debentures and representatives of the some of the Debentures holders, understandings were reached pending the approval of the Board of Kardan N.V. , agreement on the final wording and the approval of the General Meetings of both series.
The main concessions under the agreement are as follows:
1. Commitment not to pledge part of Kardan Land China (“KLC”) shares:
Until repayment of the Debentures in February 2014 (principal and accrued interest):
- 51% of KLC shares (held by GTC RE) will not be pledged.
After February 2014 repayment and until repayment of the Debentures in February 2015 (principal and accrued interest):
- 49% of KLC shares (held by GTC RE) will not be pledged.
2. Prior notice will be given in the event of pledge of assets: Until repayment of the Debentures in February 2015, Kardan will issue an immediate report / press release, 30 days in advance, in the event it reaches a financing agreement against the pledge of shares in KLC (subject to 1 above) or in Tahal Group International B.V.
3. In the event that Kardan would obtain financing through pledge of assets: Until the repayment in February 2014: - 80% of such financing proceeds - which will be raised through pledge of assets - will be used for early repayment of the 2014 payment (including accrued interest until that date). After the February 2014 repayment and until the February 2015 repayment:
- 60% of the proceeds of such financing that will be used for repayment of the debentures, as long as up to 50% (of the 60%) through repurchase of Debentures, on the condition that no more than 80% of the repurchased Debentures will be of one specific series.