Engel East Europe N.V.
08 January 2007
8 January 2007
PRESS RELEASE ENGEL EAST EUROPE N.V.
€15M investment by International Fund
Engel East Europe N.V. ('Engel' or 'the Company'), the AIM-listed Central and
Eastern European ('CEE') residential property developer (EEE:L), is pleased to
announce that it has signed a Terms of Agreement ('Agreement') with a
prestigious international investment fund specialising in emerging markets ('the
Fund'). The principle terms of the Agreement represent an improvement to those
previously offered by another fund which was announced on 13 July 2006.
According to the Agreement, the Fund will invest in a company ('SPV') that owns
95% of the Engel Marina Dorcol ('Engel Marina') project in the Belgrade Marina,
announced on 23 February 2006, and the parties are scheduled to enter into
definitive agreements following the due diligence period.
Engel Marina won the Belgrade Marina Project following a running bid by the
Municipality of Belgrade for the development of the mixed-use project totaling a
gross building area of 76,000m2. Negotiations are under way to enlarge the scope
of the project. The development will include approximately 600 residential
units, as well as a marina, offices, a shopping centre, restaurants and coffee
shops situated on the banks of the Danube River.
According to the Agreement, the Fund will pay €10 million for 50% of the SPV
(47.5% of the project) which will be paid in three equal installments to be made
every six months. The Fund will invest an additional amount according to the
project's needs, estimated at €5 million within the current scope of the
project, in addition to Engel's own investment in the project. The Fund's share
of cash distributions from the project will range between 57% and 19% according
to the performance of the project.
Engel will manage the project and will be entitled to a management fee of 5% of
the project costs. Commenting on the transaction, Jacob Engel, Executive
'This improved agreement with a prestigious fund is consistent with the
Company's strategy of creating value and minimising risk in real estate
The Engel Marina project is one of the largest and most prestigious development
projects ever undertaken in Serbia. We are confident that its unique location on
the banks of the Danube River, together with Engel's management and expertise and
the backing of a prestigious and professional Fund, will result in a very
Simon Bloomfield/Marc Cohen/Andy Harris
020 7367 8888
Notes to editors
Engel East Europe was admitted to AIM in December 2005 and is an international
residential property developer incorporated in The Netherlands. The Company
operates in the 'CEE Region' and has various developments in Hungary, the Czech
Republic, Poland, Bulgaria, Serbia and Romania, as well as operations in Germany
This information is provided by RNS
The company news service from the London Stock Exchange