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Case study

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ico-realEstate.pngXXI Century Investments Public Ltd

Location:Ukraine

Deal Type:The financial and capital restructuring of XXI Century Investments Public Limited (“XXIC” or the “Company”) via the introduction of a strategic investor

Deal Size:US$222.1 million1/ US$33.28 million2

1 Face value of restructured bonds and warrants

2 Equity value of enlarged group at the subscription price

 

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In late 2010, Strand Hanson was engaged by XXIC, a Ukrainian residential and commercial real estate developer, to advise on a financial and capital restructuring. The restructuring was required because of the lack of obtainable debt available to the Company in the wake of the global economic crisis and the more localised problems impacting the Ukrainian economy and the property sector in particular. Previously, XXIC had ceased development work across its portfolio pending access to fresh capital and was in technical default with regard to a significant portion of its existing indebtedness.

Strand Hanson advised XXIC on all facets of the transaction, including the valuation and conversion of outstanding loan notes and warrants to equity (involving detailed negotiations with bondholders and the various banking syndicates), the issuing of share options to incentivise existing management and the introduction of a new strategic equity investor, Ovaro Holdings Limited, an SPV beneficially owned by Renaissance Group Holdings Limited and Oleg Salmin, a Ukrainian businessman with existing interests in the Ukrainian property sector. Ovaro became a 60.1 per cent. shareholder in the Company on completion of the transaction, in exchange for injecting US$20 million into XXIC.

In addition, Strand Hanson advised the Company with regard to corporate governance and the protection of minority investors whose position could otherwise have been prejudiced, as well as liaising with the LSE AIM Team and overseeing the Ukrainian Anti-Monopoly Committee process.