Shacolas Group of companies have agreed with the Bank of Cyprus which is to see the bank buying mainly real estate and equity worth EUR 228 mln.
The deal involves the group’s subsidiaries, Cyprus Trading Corporation, Woolworth Properties, Ermes Department Stores and Cyprus Limni Resorts & Golf Courses.
According to an announcement, the Shacolas Group, “taking into account the conditions and changes formulated in recent years in Cyprus and within the framework of the deleveraging strategy of the group, mainly due to the banking crisis of 2013, the group has decided that the agreement with the Bank of Cyprus is in their best interest”.
Under the deal, partially a debt-to-asset swap agreement, Bank of Cyprus subsidiary companies are to buy real estate assets of CTC group companies or shares in companies of the group that have property of a total value of approximately EUR 228 million.
Reportedly, the purpose of these transactions is to reduce the bank facilities and other obligations of the group’s companies. Boards of CTC Group companies also considered the agreement to be beneficial and would facilitate companies’ future planning for further progress.
Among properties to be sold to the Bank of Cyprus is said to be Limni Resorts & Golf Courses’ golf course in Paphos. The project was to include a golf course, a five-star hotel, a wellness center, residential units and would grow to 3.3 million square meters. It is worth noting that urban planning permission was obtained in August this year. The total project was estimated to cost some EUR 800 mln.
According to the financial results of Cyprus Limni Resorts and Golfcourses Plc in the first half of 2018, the company's total borrowing amounted to EUR 145.5 mln, of which EUR 91.2 mln were for non-short-term bank loans and EUR 54.2 mln for loans from other companies of the Group. For the same period, the total assets of the company amounted to EUR 226.2 mln and equity to EUR 63.2 mln.
Details of the final form of the deal are to be announced once transactions are finalised.
Following the announcement of the Cyprus Trading Corporation, Woolworth (Cyprus) Properties, Ermes Department Stores and Cyprus Limni Resorts & Golfcourses Plc, and a request from the companies themselves, the Cyprus Stock Exchange suspended trading of the listed shares from 11 December 2018, until the final details of the transactions are announced.
