Adams Regulatory News (ADA)

22 Aug 2008 16:13



Date: 22 August 2008

On behalf of: Dawnay, Day Carpathian PLC

For immediate release

Dawnay, Day Carpathian PLC

("Carpathian" or the "Company")

Carpathian, (AIM: DDC) the retail property investment company established to invest in Central and Eastern Europe, notes the financial position of Interfruct Kft. ("Interfruct") as set out below, one of Hungary's largest cash and carry retailers, and the tenant of 23 of Carpathian's properties in Hungary. 

Rent arrears of two months' rent in respect of Interfruct have arisen, as a consequence of which, with the consent of Carpathian's secured debt provider, Anglo Irish Asset Finance PLC ("Anglo"), all of the leases have been terminated with effect from today and the tenant's bank guarantee of EUR 6.4 million for 11 months' rent (including the existing rent arrears), which is expected to become fully payable within 30 days.

The 23 properties leased to Interfruct have an annualised rent roll of EUR 6.7 million, representing approximately 14 % of the Company's total annualised rent roll. In 2007, these properties contributed approximately EUR 1.7 million or approximately 8 % of the total Company profit after tax. 

The Company had invested 8% of its equity in the portfolio, which represents approximately 12 % of the gross asset value of the entire portfolio as at 31 December 2007. Steps have been taken to draw upon the tenant's bank guarantee, which provides coverage for the equivalent of 11 months' rent (including the existing rent arrears). 

 A number of options are being actively explored to mitigate the potential loss of income (once the tenant's bank guarantee has been exhausted) and to preserve capital value. In the meantime, an agreement has been reached with Anglo to appoint an international sales and letting agent to work with the portfolio managers to identify and implement the optimal strategies for the re-letting and / or sale of the portfolio, whether as a whole or individually or in sub-portfolios. Discussions between Carpathian and Anglo regarding the restructuring of the existing loan facility are continuing to take place.

 -Ends-

Enquiries: 

Dawnay, Day Carpathian PLC: Via Redleaf Communications

Rupert Cottrell 

Carpathian Asset Management: 0203 178 2892

Paul Rogers 

Balazs Csepregi

Numis Securities Limited: 020 7260 1000 

Nominated Adviser

Anthony Richardson

Nick Westlake 

Corporate Broking

Charlie Farquhar 

Redleaf Communications: 020 7822 0200 

ddc@redleafpr.com 

Emma Kane 

Adam Leviton 

Henry Columbine