Hungary's Optima to buy Lone Star’s 61.5% stake in €2.3b Polish landlord GTC

Hungarian investor Optima has reached an agreement with Lone Star Funds to acquire the private equity firm’s 61.5% stake in Warsaw-listed CEE-focused real estate developer Globe Trade Centre (GTC).

Optima, which is acting on behalf of its Optimum Ventures Private Equity Fund, said that the GTC portfolio benefits from prime locations and development potential, and the deal is expected to provide long-term sustainable strategic investment opportunities.

'We consider GTC as a professionally managed company with strong credentials and solid financial position. The Company has a long track record in managing growth in the region since the late 1990s. We intend to continue to execute the Company’s business strategy that has been successful in the past,' an Optima spokesperson told PropertyEU.

The deal is conditional upon approval from the Polish competition authorities. Financial details were not disclosed.

PropertyEU first reported in April 2018 that Lone Star’s Real Estate Fund III was looking to sell its interest in GTC to a strategic or financial investor. Lone Star at the time had hired JP Morgan and UBS to help it review its options regarding its investment in GTC, which currently has a market cap of €770 mln (PLN 3.5 bn) and a portfolio valued at €2.3 bn.

The US firm initially invested in GTC in 2013 with the purchase of a 28% stake from the Kardan group for €160 mln and subsequently took part in the company's €140 mln capital increase in October 2015.

Shares in GTC have lost 26% of their value since the beginning of the year. They are trading at PLN 7.20, versus PLN 9.70 at the beginning of January.

GTC owns and manages €2.3 bn of assets, largely office buildings and shopping centres, for a total of roughly 621,000 m2, all located in five capital cities, namely Budapest, Bucharest, Belgrade, Zagreb and Sofia. It is currently developing 130,000 m2 of new space across four projects.

The company posted a €75 mln profit after tax in 2019 and an EPRA NAV of €1.2 bn at year-end 2019. Its loan-to-value stands at 44%.


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