Argo Real Estate Opportunities Fd Sibiu Shopping City Loan Facility Event of Default (0255W)

TIDMAREO

RNS Number : 0255W

Argo Real Estate Opportunities Fd

21 January 2013

Argo Real Estate Opportunities Fund Limited

("AREOF" or the "Company")

Statement Re: Sibiu Shopping City Loan ("SSC") Facility Event of Default

In October 2012, AREOF entered into negotiations with the syndicate of banks led by KBC Bank ("the Syndicate") that provides its subsidiary with the EUR66.5m loan facility ("the Facility") for its Sibiu Shopping City retail park. The aim of the negotiations was to complete a restructuring of the Facility which would reduce the debt service burden faced by SSC and extend the Facility beyond its current 30 November 2013 maturity. As part of these negotiations, AREOF presented the Syndicate with a detailed restructuring proposal. This restructuring proposal was rejected by the Syndicate on 17 January 2013. On 31 December 2012, while the restructuring negotiations were ongoing, the subsidiary failed to make a EUR448,750 repayment of principal under the Facility. The Company intended that a restructuring of the Facility would remedy this omission. The rejection of AREOF's restructuring proposal means that the omission will not be remedied and on 17 January 2013 the Company was informed by the Syndicate that the subsidiary is in default on the Facility.

Despite the Syndicate's rejection of AREOF's restructuring proposal, the Company is hopeful that it will be able to reach an agreement with the Syndicate on a restructuring of the Facility. The Company will provide a further update when appropriate.

This default may activate cross default clauses in certain of the AREOF group's other credit agreements. The Board is confident that if cross default clauses are activated they will be waived by those lenders affected.

Enquiries:

 
 Argo Real Estate Opportunities Fund Limited 
  David Clark, Chairman                         +44 (0)1481 231100 
 
 finnCap Limited (Nominated Adviser) 
  Matthew Robinson 
  Henrik Persson                                +44 (0) 207 220 0500

This information is provided by RNS

The company news service from the London Stock Exchange

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