CRF Ciref

 

TIDMCRF 
 
RNS Number : 1008W 
Ciref PLC 
22 July 2009 
 

 
 
CIREF Plc 
PROPOSED ACQUISITION OF THE GLANMORE PROPERTY FUND LIMITED ("GLANMORE") 
 
 
Ciref Plc ("Ciref"), the AIM-listed property investment and development company, 
notes the recent response of the board of Glanmore that it was rejecting Ciref's 
proposal, as outlined on 9 July 2009 (the "Proposal"). The board of Glanmore 
stated that it had considered the Proposal and concluded that the Offer Proposal 
is not in the best interests of the shareholders of Glanmore. It has rejected 
the Proposal in its entirety and has not given any reasons for concluding that 
the proposal is not in the best interests of its shareholders. 
Ciref continues to seek a dialogue with the board of Glanmore, and to carry out 
confirmatory due diligence, in order to support the assumptions underlying the 
Proposal.  The board of Ciref remains of the view that its Proposal provides an 
attractive alternative for Glanmore shareholders to the strategy being pursued 
by the current Glanmore board, because: 
  *  In May 2008, the board of Glanmore decided to suspend redemptions requested by 
  Glanmore shareholders for, initially, 6 months from 1 July 2008. This was 
  subsequently extended for a further 6 months until 24 June 2009.  Following the 
  Glanmore EGM on 23 June 2009 all redemptions have once again been further 
  suspended for up to three years, and no individual shareholder who has already 
  requested a redemption will now receive any cash until all redemption requests 
  can be met together. This contrasts with the liquidity each individual 
  shareholder would be able to access if he holds a newly issued Ciref share 
  listed on AIM in substitution for Glanmore shares; 
  *  Glanmore shareholders pay an annual management fee of 1.5% of aggregate value of 
  the property portfolio. In addition to the management fee, Glanmore shareholders 
  pay fees of 1.5% of the price paid for a property in acquisition fees, and 1.5% 
  of the sale price achieved on a property sale by Glanmore in disposal fees. In 
  other words, in the absence of any uplift in a property's value, a Glanmore 
  shareholder is required to pay up to 4.5% in fees to own an asset for one year. 
  Ciref believes that these fee levels are high and contrast with those charged by 
  the manager of Ciref.  By way of comparison, rather than base management fees on 
  the aggregate value of the property portfolio, Ciref's manager is paid 1% 
  annually of the net asset value of Ciref. Fees payable to Ciref's manager for 
  sourcing and executing property acquisitions are limited to 0.5% of the price 
  paid; 
  *  Glanmore will not pay an interim dividend in 2009, and the board has made no 
  commitment to shareholders that it will pay any dividend at year end 2009.  In 
  contrast, Ciref has continued to pay dividends to its shareholders throughout 
  the recent downturn in real estate markets, most recently announcing an interim 
  dividend of 1.74 pence per share, equivalent to a pro rated 4.5% of net asset 
  value. In addition, a component of the Proposal would enable Glanmore 
  shareholders to subscribe for convertible preference shares which it is 
  currently envisaged would pay a coupon of 6%. 
 
In summary, if Ciref were able to finalise its Proposal and put it before 
Glanmore shareholders, those shareholders would be presented with an opportunity 
providing improved prospects for liquidity, reduced costs and income. Similarly, 
the Proposal represents an opportunity for Ciref's shareholders to become part 
of a significantly larger entity with a more diversified portfolio. 
The board of Ciref remains open to engaging in discussions, and urges the board 
of Glanmore to give its shareholders the opportunity to pursue an alternative 
solution.  A further announcement will be made in due course. 
Enquiries: 
+------------------------------------+------------------------------------+ 
| Ciref Plc                          | +27 (0)21 683 3829                 | 
| Gavin Tipper - Chairman            |                                    | 
+------------------------------------+------------------------------------+ 
| Singer Capital Markets             | +44 (0)20 3205 7500                | 
| Nicholas How / Roger Clarke        |                                    | 
+------------------------------------+------------------------------------+ 
| Powerscourt                        | +44 (0)20 7250 1446                | 
| Elizabeth Rous                     |                                    | 
+------------------------------------+------------------------------------+ 
 
 
 
 
 
 
Singer Capital Markets Limited ("SCM"), which is authorised and regulated by the 
Financial Services Authority in the United Kingdom, is acting as nominated 
advisor and broker to Ciref and no one else in connection with the matters set 
out in this announcement and will not be responsible to anyone other than Ciref 
for providing the protections afforded to clients of SCM or for providing advice 
in relation to the Proposal. 
 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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