Part of Glenn Maud’s company counters Guernsey administration application with own legal action
Part of Glenn Maud’s Propinvest faces an administration order from a Norwegian bank as part of a legal row over a £200m Scandanavian portfolio. The battle is part of an ongoing rearguard action as Propinvest, which owns stakes in trophy assets such as the Citi Tower in Canary Wharf and the Santander headquarters in Madrid, tries to work through legacy debt issues.
As part of this, Maud is understood to be also working on a restructuring of his “underwater” Gemini portfolio. The Norwegian DnB NOR Bank filed an application for an administration order against Guernsey-registered Propinvest Group Ltd with the Guernsey Registry in July this year. Hearings on the application that were scheduled for July and last week were deferred until the end of September.
Propinvest Group is understood to be vigorously opposing the application. It argues that DnB is not a creditor of the company and has no grounds for seeking the administration order. It has subsequently brought its own legal proceedings against DnB in Norway.
Propinvest Group is believed to be a holding company that owns shares in other companies that are part of the Propinvest structure. If the order is granted, Grant Thornton would be appointed as administrator.
The row centres on the consensual takeover of a portfolio of 62 commercial properties, mostly retail, in Scandinavia. They were bought by Royston Norway, a joint venture between Propinvest and Jack Petchey’s Incorporated Holdings, in January 2007. Incorporated’s stake was bought out by Propinvest in 2008.
DnB provided a loan to refinance the portfolio of around €200m, which matured in December last year. Propinvest had sought to sell the portfolio to repay the debt, first to private equity firm Cerberus and then to Norwegian pension funds.
However, the bank is believed to have vetoed the sale because wanted an arrangement that allowed it to take over the shares in Royston Norway and the management of the company for a nominal fee of NOK1.
DnB’s accounts show that this deal was completed on 16 June this year, and the portfolio was valued at NOK1.8bn (£202m) with negative equity of NOK218m (£25m). The original loan is believed to have contained a guarantee from Propinvest Group Ltd. It is under this guarantee that DnB is pursuing Propinvest.
Propinvest is understood to dispute this valuation, arguing that it had lined up investors to buy the portfolio for more than the value of the debt, and that this guarantee was negated by the consensual restructuring.
Separately, Maud is understood to be working on a restructuring of Gemini – a mixed portfolio of secondary UK assets that has more than £1bn of creditors but is worth less than £615m. The restructuring will aim to get the best result for bondholders.
All parties declined to comment
No comments:
Post a Comment