27 June 2019
Milan, June 27th, 2019 – COIMA RES (the "Company") informs that, Meritz Financial Group has acquired (through a Korean trust) a 50% stake in the Vodafone complex from COIMA RES. Meritz Financial Group is a South Korean financial holding company with a market cap of Euro 1.6 billion and consolidated assets of Euro 40 billion.
The Vodafone complex, acquired by COIMA RES in 2016, is LEED Silver certified and is situated in Milan. The complex is the headquarter of Vodafone’s Italian operations and it is entirely leased with a WALT of more than 7 years. The transaction values the complex at Euro 213 million (i.e. a 4% premium to acquisition price and at a 2% premium to the last appraisal value) representing an EPRA Net Initial Yield of 6.1% and a 13% levered IRR (8% unlevered IRR). COIMA RES will continue to benefit from the cash flow and upside of the Vodafone complex for its retained 50% stake.
The transaction consists in: (i) the reimbursement by COIMA RES of Euro 130 million of financing and the signing by COIMA RES of a new 5-years financing for a corresponding amount at comparable economic conditions, (ii) the contribution of the Vodafone complex and the new financing to a newly set up fund named COIMA Core Fund VIII in exchange for 100% of the funds units and (iii) the sale of 50% of the fund’s units to the Korean investor for Euro 44 million. COIMA RES will continue to consolidate the Vodafone complex given the retained governance granting COIMA RES control on major decisions, with the Korean investor acting as financial partner. The new fund will be managed by COIMA SGR without additional costs for COIMA RES.
The transaction allows COIMA RES to further diversify its portfolio of assets and tenants, reducing, on a pro-rata basis, the weight of the Vodafone complex from 31% to 19% of the portfolio and the portion of Vodafone gross rents from 37% to 23% of total. Pro-forma for the transaction, the LTV of COIMA RES is reduced, on a consolidated basis, to 28% (from 34% as of March 31st, 2019).
Since IPO, COIMA RES has rotated assets representing more than 30% of the acquisition volume at a blended premium to acquisition price of 6.5%, including the sale of Deutsche Bank branches for Euro 42 million (at a valuation in line with the IPO contribution value) and the sale of the Eurcenter property in Rome for Euro 90 million (at a premium of 13% vs purchase price and with a 20% IRR).
Following the co-investment with COIMA Opportunity Fund II executed for the Corso Como Place project, the transaction with Meritz Financial Group provides further evidence of the capital market capabilities of the COIMA platform and its ability to team up with leading global investors allowing COIMA RES to rotate assets, crystallise performance and generate additional firepower. Following the transaction, COIMA RES will have more than Euro 100 million of liquidity (on a consolidated basis). As previously indicated, the investment strategy of COIMA RES will remain focused on further concentrating its portfolio in Milan from the current 90% level.
Manfredi Catella, Founder and CEO of COIMA RES commented: “The transaction demonstrates the ability of the COIMA platform to team up with primary global investors in addition to validating COIMA RES’ portfolio valuation and increasing its diversification. The transaction generates additional firepower for further acquisitions in Milan where we already have 90% of our portfolio.”
Capital Markets Director
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