Aristo sale negotiations collapse

Aristo Developers Pcl (ARD) announced that negotiations for the sale of the company ended unsuccessfully and there was no agreement signed. Last week, Artisto had secured from the CSE suspension of its shares for two days pending the outcome of intense negotiations aimed at finalizing the takeover bid, which later on was revealed to be with Pandora Invesments, owned by the Leptos Group.

Informed sourced told the Financial Mirror that the bid was for 100% of the company and it had to be all-out cash, which if agreed, will be backed by the majority shareholders controlling 75% of the capital.

The Aristodimou family controls just above 50% of the CSE listed Aristo Developers and the Elma Group controls another 25%. The remaining 25% is spread among the public.

The price at which negotiations were being held was reported to be around 90c to 100c or EUR 1.55 to EUR 1.73 per share, with the buyer reportedly backed by a Cypriot bank, which in turn is acting on behalf of a foreign financial institution willing to provide a bank guarantee.

Aristo has a total of 128.27 mln shares in circulation and prior to the suspension of trading on its shares, had a market cap of EUR 169 mln.

In 2005, ARD reported EUR 18.8 mln in profits while for the first half of 2006, the reported profits were EUR 11 mln. Assuming EUR 20 mln in forecasted profit for 2006 and based on a p/e ratio of 15 times earnings, the company is worth at least EUR 300 mln or EUR 2.33 per share.

Aristo Developers also owns CYP 200 mln of properties and is reported to have secured permits for the development of three golf courses.