STOCKHOLM, Sweden, Oct. 23, 2003 (PRIMEZONE) -- Drott (Other OTC:DOTBF):
The sale is an element in the new strategic direction for Drott's commercial real estate operations, where the focus is on properties in Stockholm.
The portfolio comprises 27 properties -- three of which are leaseholds -- with 118,400 square meters of rentable space (including 3,400 sq. m. of residential space).
The occupancy rate is 90 percent. Current leases generate annual rent of SEK 131 million and an operating surplus of SEK 84 million. The sale is being executed through a special purpose company, with the closing and payment of the full proceeds scheduled for December 30, 2003. The buyer is Lennart Wallenstam Byggnads AB (publ), a publicly listed real estate company based in Gothenburg. Effects for Drott
The sales price amounts to SEK 1,420 million. An independent appraisal of the market value of Drott's property portfolio was made as per December 31, 2002. The market value of the properties now being sold was appraised at the time at SEK 1,473 million.
For accounting purposes, the sale results in a gain of SEK 165 million, which will be reported in the fourth quarter 2003. A provision of approximately SEK 20 million for estimated future costs associated with the sale is accounted for in the gain.
The fiscal residual value in the portfolio is approximately SEK 425 million less than the sales price. The effect on liquidity based on the difference is estimated at SEK 25 million. Outstanding tax loss carryforwards are not affected by the sale. The sale initially reduces the Group's annual cash flow by approximately SEK 40 million.
The sale requires negotiations pursuant to the provisions of the Co- determination in the Workplace Act, which will begin immediately. Catella Corporate Finance has served as Drott's adviser in the sales process.
Schedule of real estate
Area Properties Address Rentable Of which
sold space residentia
excl. l space
garages
Inner Gullbergsvas Hamntorget 6 5,981 0
city s 1:12
Inner Inom Sodra Hamng. 29, 4,456 0
city Vallgraven Drottningg. 30
15:3
Inner Inom Vastra Hamngatan 2,802 0
city Vallgraven 8, etc.
17:13
Inner Inom Sodra Larmgatan 3,110 0
city Vallgraven 20, etc.
23:11
Inner Inom Kungsportsplatsen 5,521 0
city Vallgraven 1, etc.
25:1+4
Inner Inom Gronsakstorget 3, 4,194 0
city Vallgraven etc.
26:8
Inner Inom Kungstorget 1 14,382 3 252
city Vallgraven etc.
26:9
Inner Inom Lilla Torget 1 3,197 0
city Vallgraven
53:14
Inner Inom Lilla Torget 2, 3,051 0
city Vallgraven etc.
53:15
Inner Nordstaden Kronhusgatan 16 3,322 136
city 24:11
Inner Stampen 6:17 Odinsgatan 13, 7,480 0
city etc.
Arendal Arendal 5:1 Karrlyckevagen 24 2,398 0
Biskopsga Biskopsgarde Ruskvadersgatan 2,305 0
rden n 45:1 22, etc.
Hogsbo Hogsbo 5:7 Olof Asklundsgata 3,213 0
25
Kobbegard Kobbegarden Datavagen 18 1,615 0
en 6:169
Kobbegard Kobbegarden Datavagen 29 1,290 0
en 6:55
Kobbegard Kobbegarden Ekonomivagen 3-5 4,251 0
en 6:731
Karra Karra 72:33 Tagenevagen 34 6,165 0
Karra Karra 75:2 Transportgatan 37 7,899 0
Karra Karra 75:4 Transportgatan 39 8,000 0
Karra Karra 90:1 Orrekulla 10,740 0
Industrigata 61
Harryda Solsten Foretagsvagen 2 2,885 0
1:110
Harryda Solsten Molnlycke 0 0
1:126 foretagspark
Harryda Solsten Konstruktionsvage 4,953 0
1:132 n 14
Tynnered Tynnered Femvagsskalet 4 2,500 0
1:15
Onnered Onnered Onnereds Brygga 1- 2,711 0
762:369 17
118,422 3,388
Drott is being divided into two focused, publicly listed companies. Shareholders at the Annual General Meeting in 2004 will vote on the Board of Directors' proposal to distribute Bostadsaktiebolaget Drott, a streamlined residential real estate company active in around ten Swedishgrowth regions. As proposed, today's Drott would at the same time changeits name to Fabege AB, an active, streamlined commercial real estate company focused on Stockholm.
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http://www.waymaker.net/bitonline/2003/10/23/20031023BIT00130/wkr0001.doc
http://www.waymaker.net/bitonline/2003/10/23/20031023BIT00130/wkr0002.pdf