REG - Brookfield Global Tritax EuroBox PLC SEGRO PLC - Update re Tritax EuroBox

SEGROAnnouncement

12/11/2024 07:00

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RNS Number : 8055L  Brookfield Global Asset Mgmt Ltd  12 November 2024

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE
A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

12 November 2024

RECOMMENDED CASH ACQUISITION

of

Tritax EuroBox plc ("Tritax EuroBox")

by

Titanium Ruth Bidco Limited ("Bidco")

(a newly formed company indirectly owned by one of Brookfield's real estate
private funds)

BROOKFIELD ENTERS INTO NON-BINDING HEADS OF TERMS AND BINDING EXCLUSIVITY
AGREEMENT WITH SEGRO TO SELL CERTAIN COMPANIES WITHIN THE GERMAN AND DUTCH
PROPERTY PORTFOLIO OF TRITAX EUROBOX FOLLOWING COMPLETION

On 10 October 2024, the boards of directors of Tritax EuroBox and Bidco
announced that they had reached agreement on the terms and conditions of a
recommended cash acquisition by Bidco of the entire issued, and to be issued,
ordinary share capital of Tritax EuroBox (the "Brookfield Offer") at a price
of 69 pence per Tritax EuroBox Share. The Brookfield Offer is being
implemented by means of a Court-sanctioned scheme of arrangement under Part 26
of the Companies Act 2006 (the "Scheme").

The circular in relation to the Scheme was published or made available to
Tritax EuroBox Shareholders on 28 October 2024 (the "Scheme Document").

The Court Meeting and General Meeting in respect of the Scheme are and remain
scheduled for 20 November 2024.

Capitalised terms used in this announcement shall, unless otherwise defined,
have the same meanings as set out in the Scheme Document.

As previously announced in paragraph 6 (Intentions of Bidco with regard to the
business of Tritax Eurobox) of Part 1 of the Scheme Document, following the
Announcement Date and the Effective Date, Bidco's intention was to explore the
potential sale of certain properties within the Tritax EuroBox property
portfolio. The properties to be sold pursuant to such sale strategy and timing
for such disposals were subject to on-going diligence (including, analysis of
any intra-group re-organisations required to implement such sales) and
commercial negotiations but it was Bidco's intention, subject to prevailing
market conditions, to generate proceeds from such sales representing
approximately 20-30% of the gross value of the Tritax EuroBox property
portfolio.

Bidco is pleased to announce that on 11 November 2024, it and Brookfield
Property Group Limited, an affiliate of Brookfield, have entered into a
non-binding heads of terms and a binding exclusivity agreement ("HoT") with
SEGRO plc ("SEGRO") in respect of the proposed sale, subject to the Scheme
becoming Effective, by Tritax EuroBox of certain German and Dutch companies of
the Tritax EuroBox Group to SEGRO, acting by itself or through one of its
strategic partnerships (the "Purchaser") (the "On-Sale Transaction"). The
consideration payable pursuant to such On-Sale Transaction reflects
approximately 31% of the gross value of the Tritax EuroBox property portfolio
of €1,512.6 million, including purchasers' costs such as RETT.

The assets underlying the On-Sale Transaction total 370,000 sq m of
fully-leased, highly reversionary, modern logistics space and are located in
the established and attractive logistics hubs of Breda and Roosendaal in the
Netherlands as well as in the Frankfurt corridor and the Rhine-Ruhr region in
Germany. The assets currently generate approximately €23 million of headline
rent, resulting in a blended net initial yield of 4.7 per cent and a net true
equivalent yield of 5.3 per cent.

Bidco notes the announcement by SEGRO today that the terms of the SEGRO Offer
are final and will not be increased or improved and that SEGRO will not switch
to a Takeover Offer (as defined in Section 974 of the 2006 Act) and that SEGRO
expects to invoke conditions (b)(i)(2) and (b)(ii)(2) of the SEGRO Scheme
Document following 15 November 2024 and therefore the SEGRO Offer will lapse
following 15 November 2024.

The On-Sale Transaction is subject to the Scheme becoming Effective, which is
expected to take place on 10 December 2024.

The terms of the Brookfield Offer remain unchanged.

Following the Scheme becoming Effective, and in addition to the On-Sale
Transaction, Bidco intends to continue to seek to explore the potential sale
of certain properties within the Tritax EuroBox property portfolio. Bidco has
not determined how proceeds from such sales will be allocated but options
include use of such proceeds to reduce the liabilities of the group and/or
further accretive investment in real estate assets.

Details of the Transaction

·      The HoT contemplates that a separation agreement will be entered
into between Bidco and the Purchaser prior to the Effective Date pursuant to
which, as soon as possible following the Effective Date, the following
companies would be sold by Tritax EuroBox to the Purchaser in accordance with
the terms of share sale and purchase agreement (a form of which will be
appended to the separation agreement):

o  Dietz 23. Grundbesitz GmbH - which holds the relevant property located in
Bönen, Germany;

o  Dietz FNL 5. Grundbesitz GmbH - which holds the relevant property located
in Dormagen; Germany;

o  Tritax Eurobox (Gelsenkirchen) PropCo GmbH (previously known as Dietz 26.
Grundbesitz GmbH) - which holds the relevant property located in
Gelsenkirchen, Germany;

o  Dietz Logistik 44.Grundbesitz GmbH  - which holds the relevant property
located in Lich, Germany;

o  Tritax Eurobox (Breda) PropCo B.V. - which holds the relevant property
located in Breda, Netherlands; and

o  Tritax Eurobox (Roosendaal) PropCo B.V. - which holds the relevant
properties located in Roosendaal, Netherlands,

(together, the "Relevant Propcos").

·      The share sale and purchase agreement would be executed following
the Brookfield Offer becoming Effective.

·      The total consideration for the Relevant Propcos, including RETT
as applicable, will be paid in cash and values 100 per cent. of the assets at
€470 million, although the actual consideration payable to Bidco will
reflect any minority interests and other customary adjustments for a
transaction of this nature.

·      Completion of the On-Sale Transaction is conditional upon receipt
of antitrust approval or expiry of the applicable waiting period in the
European Union, as relevant. Neither this condition nor the On-Sale
Transaction is a  Condition to the Brookfield Offer, which remains subject to
the satisfaction or (if capable of waiver) the waiver of the Conditions set
out in Part 4 of the Scheme Document, including the sanction of the Scheme by
the Court at the Scheme Court Hearing and the delivery of the Scheme Court
Order(s) sanctioning the Scheme.

·      Customary interregnum covenants will apply between signing of the
share sale and purchase agreement (which would be signed following the
Brookfield Offer becoming Effective) and completion of the On-Sale Transaction
to require Tritax EuroBox to continue to operate the business and manage the
Relevant Propcos in the ordinary course and not take certain actions without
the consent of the Purchaser (subject to customary thresholds and exceptions).

A copy of the HoT will be available on Bidco's website at
www.public-documents.co.uk (http://www.public-documents.co.uk) by no later
than 12 noon (London time) on the Business Day following the publication of
this announcement.

Enquiries:

 Brookfield
 John Hamlin                                       +44 (0) 7436 054 717

 Marie Fuller                                      +44 (0) 20 7408 8375
 Citi (Financial Adviser to Bidco and Brookfield)  +44 (0) 20 7986 4000
 James Ibbotson

 Bogdan Melaniuc

 James Carton

 

Important notices

Citigroup Global Markets Limited ("Citi"), which is authorised by the PRA and
regulated by the FCA and the PRA in the United Kingdom, is acting exclusively
as financial adviser to Bidco and Brookfield and no one else in connection
with the Acquisition and the matters set out in this announcement and will not
be responsible to anyone other than Bidco and Brookfield for providing the
protections afforded to clients of Citi nor for providing advice in relation
to the matters set out in this announcement. Neither Citi nor any of its
affiliates, directors or employees owes or accepts any duty, liability or
responsibility whatsoever (whether direct or indirect, whether in contract, in
tort, under statute or otherwise) to any person who is not a client of Citi in
connection with this announcement, the Acquisition, any statement contained
herein or otherwise.

You should read this announcement and if you are in any doubt as to the
On-Sale Transaction, you are recommended to seek your own independent
financial advice immediately from your stockbroker, solicitor, accountant,
bank manager or other independent financial adviser duly authorised under the
Financial Services and Markets Act 2000 (as amended) if you are resident in
the United Kingdom or, if you are not so resident, from another appropriately
authorised independent financial adviser.

 

This announcement does not constitute or form part of an offer or an
invitation to purchase or subscribe for any securities, or a solicitation of
an offer to buy any securities, whether pursuant to this announcement or
otherwise, in any jurisdiction in which such offer, invitation or solicitation
is or would be unlawful.

 

This announcement does not comprise a prospectus or a prospectus equivalent
document or an exempted document.

 

The contents of this announcement do not amount to, and should not be
construed as, legal, tax, business or financial advice.

 

The statements contained in this announcement are made as at the date of this
announcement, unless some other date is specified in relation to them, and
publication of this announcement shall not give rise to any implication that
there has been no change in the facts set forth in this announcement since
such date.

 

The Acquisition will be subject to English law, the jurisdiction of the Court
and the applicable requirements of the City Code, the Panel, the London Stock
Exchange, the FCA, the Listing Rules and the Registrar of Companies.

Overseas jurisdictions

The release, publication or distribution of this announcement and any formal
documentation relating to the On-Sale Transaction in, into or from
jurisdictions other than the United Kingdom may be restricted by law and/or
regulation and therefore any persons who are subject to the laws of any
jurisdiction other than the United Kingdom should inform themselves about and
observe any applicable legal or regulatory requirements. Any failure to comply
with the applicable restrictions may constitute a violation of the securities
laws of any such jurisdiction. To the fullest extent permitted by applicable
law, the companies and persons involved in the Acquisition disclaim any
responsibility or liability for the violation of such restrictions by any
person.

This announcement has been prepared for the purpose of complying with English
law and the City Code and the information disclosed may not be the same as
that which would have been disclosed if this announcement had been prepared in
accordance with the laws of jurisdictions outside the United Kingdom.

Forward-looking statements

This announcement (including information incorporated by reference into this
announcement) and other information published by Bidco contain certain
forward-looking statements with respect to the financial condition,
strategies, objectives, results of operations and business of Tritax EuroBox
and its group and certain plans and objectives of Bidco with respect thereto.
These forward-looking statements can be identified by the fact that they do
not relate only to historical or current facts. Forward-looking statements are
prospective in nature and are not based on historical facts, but rather on
current expectations and projections of the management of Bidco and Tritax
EuroBox about future events, and are therefore subject to risks and
uncertainties which could cause actual results to differ materially from the
future results expressed or implied by the forward-looking statements. The
forward-looking statements contained in this announcement include statements
relating to the expected effects of the Acquisition on Bidco and Tritax
EuroBox, the expected timing and scope of the Acquisition and other statements
other than historical facts. Forward-looking statements often use words such
as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal",
"believe", "hope", "aims", "continue", "will", "may", "should", "would",
"could", or other words of similar meaning. These statements are based on
assumptions and assessments made by Bidco and/or Tritax EuroBox in light of
their experience and their perception of historical trends, current
conditions, future developments and other factors they believe appropriate. By
their nature, forward-looking statements involve risk and uncertainty, because
they relate to events and depend on circumstances that are expected to occur
in the future and the factors described in the context of such forward-looking
statements in this announcement could cause actual results and developments to
differ materially from those expressed in or implied by such forward-looking
statements. Although it is believed that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be given that such
expectations will prove to have been correct and readers are therefore
cautioned not to place undue reliance on these forward-looking statements.

There are several factors which could cause actual results to differ
materially from those expressed or implied in forward-looking statements.
Among the factors that could cause actual results to differ materially from
those described in the forward-looking statements are changes in global,
political, economic, business and/or competitive conditions, market and
regulatory forces, future exchange and interest rates, changes in tax rates
and future business combinations or dispositions.

Each forward-looking statement speaks only as at the date of this
announcement. Neither Bidco nor its group, assumes any obligation to update or
correct the information contained in this announcement (whether as a result of
new information, future events or otherwise), except as required by applicable
law or by the rules of any competent regulatory authority.

Publication on website

A copy of this announcement and the documents required to be published
pursuant to Rules 26.1, 26.2 and 26.3 of the City Code will be available,
subject to certain restrictions relating to persons resident in Restricted
Jurisdictions, for inspection on Bidco's website at www.public-documents.co.uk
(http://www.public-documents.co.uk) by no later than 12 noon (London time) on
the Business Day following the publication of this announcement.

Save as expressly referred to in this announcement, neither the contents of
these websites nor the content of any other website accessible from hyperlinks
on such websites is incorporated into, or forms part of, this announcement.

 

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