8 Nov 2011 07:00
8 November 2011
Brainspark plc
("Brainspark" or "the Company")
Disposal of Mediapolis Interests and
Update on Leisure Sector Investments
Further to the statement of 27 May 2011, Brainspark plc (AIM: BSP), a fast growing international investment company, is pleased to announce that it has signed the final agreement for the sale of the Company's interests in the land near Albiano (the proposed Mediapolis theme park) for a consideration of EUR 28 million, a multiple of three times its initial investment.
The interests have been sold to the Michelangelo 2 Real Estate Fund ("Michelangelo 2") and the consideration will be satisfied on or before 31 December 2011 through the issue to Mediapolis SpA ("Mediapolis"), which is a 69.12 per cent. owned subsidiary of the Company, of shares in Michelangelo 2. The fund currently has more than EUR 170 million of assets under management and is managed by Sorgente SGR (www.sorgentesgr.it) a leading real estate management company with over EUR 2 billion of assets under management, including some of the world's most iconic buildings, such as the Chrysler Building (recently sold) and the Flatiron in New York and Galleria Colonna in Rome.
In addition, Mediapolis will remain entitled to develop, build and manage the future theme park and the hotel, where it would be expected to face certain professional costs which would however be tempered by compensation in the form of success fees.
Mediapolis has agreed to pay a penalty up to a maximum of EUR 3 million to Sorgente SGR in case of non-performance of some of the tasks included in the development, building and management contracts related to the new theme park. The penalty, should it be required to be paid, can be paid partially at the end of the first year with the balance to be paid at the end of the third year, or in total at the end of the third year.
Mediapolis will indemnify Sorgente on the fiscal aspect of the sale of the land to the Fund, but this transaction is expected by the Mediapolis board to be neutral for the parties involved based on the current Italian tax legislation.
The Board of Brainspark considers the Michelangelo 2 shares, which are unquoted, as a liquid asset for Brainspark and will be utilised by Mediapolis to facilitate the funding of its acquisition strategy in the leisure sector.
This sale represents a value per share of £0.41 on the 40,836,853 Brainspark's shares in issue (fully diluted after admission of the shares referred to in the acquisitions described below and admission of the 9,750,000 shares due for the investment in ORH srl (Ora Hotels) announced on 28 June 2011).
New Real Estate Investments
Through its Mediapolis subsidiary, Brainspark has acquired from Regilco srl, 10 villas on the Liscia di Vacca bay in Sardinia, one of the most prestigious resort towns in Italy. The consideration for the acquisition was EUR 4.15 million which will be satisfied through the issue of 7,150,000 Brainspark new ordinary shares at a price of 50 pence per share, a 67% per cent. premium to the closing price before suspension. The issuing of Brainspark new ordinary shares, used as a payment by Mediapolis, has created a credit for Brainspark in Mediapolis of EUR 4.11 million that can be converted in Mediapolis equity capital should the Company wish to do so. The real estate will be managed and rented by the Company's 20 per cent. owned property management subsidiary, Sforza srl.
In addition, through Mediapolis, the Company has acquired a 3,000 sq m office building in via Astesani, Milan, from Argentaria srl for EUR 2.5 million. The property is to become the head office for the Brainspark group and will house the operations and staff of Bibop, the Company's majority owned digital media subsidiary. The consideration for the acquisition will be satisfied through the issue of 5,000,000 Brainspark new ordinary shares at a price of 50 pence per share, a 67% per cent. premium to the closing price before suspension. The issuing of Brainspark new ordinary shares, used as a payment by Mediapolis, has created a credit for Brainspark in Mediapolis of EUR 2.5 million that can be converted in Mediapolis equity capital should the Company wish to do so. The property is to be managed by Sforza srl.
As a result of the above transactions, should Brainspark choose to convert the credits thus created towards Mediapolis it would increase its holding in Mediapolis beyond the 69.12 per cent. which it currently owns.
A further announcement will be made once the additional 12,150,000 Brainspark ordinary shares referred to above have been issued and the relevant application for admission to trading on AIM has been made.
Alfredo Villa, CEO and Chairman of Brainspark, commented, "The Mediapolis transaction is an exceptional deal for Brainspark and its shareholders. The new funds will allow us to concentrate our investment efforts within the leisure and digital media sectors, where we are already creating a sizeable portfolio of quality assets."
-ends-
For further information please contact:
Brainspark plc +39 02 525 051
Alfredo Villa, Chairman and CEO
Arbuthnot Securities +44(0) 20 7012 2000
Antonio Bossi / Ed Groome
Leander PR +44(0) 7795 168 157
Christian Taylor-Wilkinson
About Brainspark Plc
Brainspark plc (AIM: BSP) is an AIM listed investment company pursuing a dynamic strategy to create a comprehensive portfolio of companies primarily encompassing the interactive media, leisure, entertainment and financial services sectors mainly in Italy but also other European countries. The company may be either a passive or active investor and Brainspark's investment rationale ranges from acquiring minority positions with strategic influence through to larger controlling positions.