Early redemption of Debt Instruments
22 February 2007
Great Portland Estates plc (GPE) announces two transactions to simplify its debt capital structure and reduce the cash cost of financing. Assuming the transactions complete, diluted NAV per share and EPS will be marginally enhanced.
5.25 per cent Convertible Bonds due 2008 (the Bonds)
GPE wishes to exercise its option, under Condition 8(c)(i) of the Bonds, to redeem the Bonds presently outstanding in full at their principal amount. The Bonds will be redeemed in full on 31 March 2007 (the Bond Redemption Date), together with interest accrued to (but excluding) the Bond Redemption Date.
Bondholders may avoid the redemption by GPE by exercising the Bondholders' right (the Conversion Right) to convert the Bonds they hold into registered Ordinary Shares of 12.5 pence each in the capital of GPE (the Ordinary Shares) in accordance with Condition 7(a) of the Bonds. The Conversion Right may be exercised by Bondholders up to the close of business on 23 March 2007.
The number of Ordinary Shares to be issued on exercise of a Conversion Right is to be determined by dividing the principal amount of the relevant Bond(s) by the conversion price (the Conversion Price). The Conversion Price is currently 310 pence per Ordinary Share, but is subject to adjustment in the circumstances set out in Condition 7(b) of the Bonds, and will be calculated on the London business day following delivery of the Conversion Notice (as defined in the Conditions of the Bonds).
The Current Market Price of the Ordinary Shares (as defined in Condition 7(b)) as at 20 February 2007, being the latest practicable date for calculation before publication of this notice, was 778 pence per Ordinary Share. The aggregate principal amount of Bonds outstanding as of 21 February 2007 was £49.6 million. Assuming all Bondholders exercise their Conversion Right, GPE would issue a further 16 million new Ordinary Shares.
Value of the Ordinary Shares into which each £1,000 principal amount of Bonds is convertible based on the Current Market Price of the Ordinary Shares as at 20 February 2007 (ignoring fractions of Ordinary Shares) - £2,505.
Redemption Price (including accrued interest) for each £1,000 principal amount of the Bonds - £1,004.
7.25 per cent First Mortgage Debenture Stock 2027 (the Stock)
GPE wishes to redeem the whole of the Stock presently outstanding. The Stock will be redeemed in full on 28 March 2007 (the Stock Redemption Date).
The redemption price will be 132.05 per cent, as determined in accordance with Condition 2(A) of the Stock as at 3.00 p.m. on 19 February 2007, together with the interest (on the nominal thereto) accrued up to and including the Stock Redemption Date. The aggregate principal amount of Stock outstanding as of 21 February 2007 was £36,850.
Following redemption on the Stock Redemption Date, the Stock shall be cancelled.
The communication of this press release is only being made to those persons in the United Kingdom who fall within Article 42(1)(c) and/or Article 43(2) of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 or any other persons to whom it may otherwise lawfully be made under that Order.
Copies of this press release are not being, and must not be, mailed or otherwise forwarded, distributed or sent in or into or from the United States, and persons receiving this press release (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it into or from the United States. GPE will neither consider nor respond to any communications in respect of offers of Stock or Bonds made by persons in the United States.