Investment update: Green Isle Clarification

RNS Number : 3546H

Craven House Capital PLC

16 August 2016

 

16 August 2016

 Craven House Capital plc

("Craven House" or the "Company")

Investment update: Green Isle Clarification

The Company wishes to provide further clarification for shareholders regarding the successful repayment to the Company of the mortgage loan over the Green Isle Hotel.

The initial transaction took place on 24 May 2013. At the time, Greentel Limited ("Greentel") was the sole owner of the Green Isle Hotel. Greentel was wholly owned by Cranburg Limited, in receivership. At the time of purchase Greentel had defaulted on secured and unsecured debts in excess of €10 million.  

Craven House purchased several of the senior loans for €700,000. These loans were restructured and at the same time, detailed negotiations took place with unsecured creditors to ensure the hotel's operations continued uninterrupted. Craven House also bought Greentel from the receiver for €1 on 24 May 2013. At this time Craven House was therefore the senior secured creditor as well as sole shareholder in the holding company.

Craven House, along with the management company hired to operate the hotel, then restructured the business and returned it to profitability while beginning much needed delayed and neglected maintenance.

In November 2013 Craven House sold the Green Isle hotel to new owners in a transaction whereby Craven House retained a new €1.5 million first mortgage secured on that property. The mortgage was at an interest rate of 4% per annum.  By this time, Craven House had also recovered the vast majority of the initial €700,000 investment from cashflow generated by the hotel. The original source of the funds for the €700,000 investment was a loan provided to Craven House by the Company's investment manager (which, as announced at the time, constituted a related party transaction). The utilization of leverage in this manner further enhanced the Company's return.

Payments received by the Company in respect of the loans acquired equate in aggregate to €2.19m comprising, repayments of principle of the original loan amount, repayments of restructured and significantly lower principle of €1.5m and interest payments.

The board believes the Green Isle investment to have provided an excellent return for the Company and its shareholders. 

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For further information please contact:

Craven House Capital Plc Mark Pajak www.Cravenhousecapital.com	Tel:   [phone]
SI Capital Broker Nick Emerson www.sicapital.co.uk	Tel: [phone]
SPARK Advisory Partners Limited Nominated Adviser Matt Davis/Mark Brady www.Sparkadvisorypartners.com	Tel:   [phone]

About Craven House Capital

Craven House Capital (AIM: CRV) is an investment company seeking deep value opportunities across the globe.  It seeks to create long-term shareholder value on a per share basis by deploying patient capital.  Craven House seeks to acquire real assets and operating companies that capable of generating steady cash flows.

 

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