Trinity Capital Regulatory News (TRC)

2 Oct 2008 07:00



2 October 2008

Trikona Trinity Capital PLC

("Trikona TC" or "the Company")

Pre-Close Update

Trikona Trinity Capital PLC (AIM: TRC), a fund created for investing in Indian real estate and infrastructure, and managed by Trikona Capital, announces a pre-close update ahead of its preliminary results for the period ended 30 September 2008.

Notwithstanding current market conditions, recent transactions serve to underpin existing valuations. By divesting significant parts of its portfolio, the Company continues to be cash generative and will use a portion of these proceeds to fund existing commitments and obligations.

The impact to the Company of the global economic turmoil should be minimal in comparison to sectors with greater exposure to the US financial markets. Moreover, the underlying holding company has no debt and the debt level within each individual special purpose vehicle is minimal.

Development Projects and Divestments

In June 2008, Trikona TC completed its second divestment of part of its equity holdings with SachsenFonds GmbH ("SachsenFonds" or "SF"), part of leading German fund manager, Kanam Gruppe, for £54.10 million representing a gain of 115%. SF and Trikona TC also co-invested £20.04 million in MIG Bandra, a new redevelopment located within the MIG Bandra area in partnership with Rustomjee Constructions Pvt. Ltd In September 2008, SF further extended its strategic partnership with Trikona TC by agreeing a third transaction with a value worth up to £90 million to acquire certain assets and co-invest in a portfolio of new and existing projects (the "Transaction"). This transaction includes four new projects: Sankalp Buildwell Private Limited, Jodhana Developers Private Limited, Enigma Constructions Private Limited and Horizon Countrywide Logistics Limited. The first tranche of the Transaction is expected to close in October with the simultaneous funding of approximately £32 million. The Company has committed to the reinvestment of £24.68 million of this amount in the four new projects referred to above. As a part of the second tranche of the Transaction, due to close by 31 March 2009, SF will further acquire up to £16.03 million in three existing entities, bringing the total value of the sell-down to a maximum consideration of £48.01 million.

Board Review

In lieu of the current market conditions, the Board has decided to actively undertake a review of mechanisms designed to address the gap between the Company's share price and its NAV, and will announce the outcome as part of the Company's interim results statement. During the review period, the Company shall refrain from making any new investments, reserve any cash resulting from dispositions and return such cash through the selected mechanism other than where required to support current and future dispositions. 

Outlook

Michael Cassidy CBE, Chairman of Trikona Trinity Capital PLC, said: "Over the last six months we have continued our strong track record of delivering results and creating significant value for our shareholders. Not only have we sourced a number of exciting new investment opportunities but we have demonstrated our execution capability by realising further returns through our partnership with SF, a partnership that continues to go from strength to strength."

- ENDS -

Enquiries:

Trikona Trinity Capital PLC managed by Trikona Capital Limited 

Aashish Kalra, Managing Director +91 11 4659 6000

Sally Lewis, Director of Investor Relations +44 207 148 5360

Bell Pottinger Corporate & Financial +44 207 861 3232

Mike Davies/ Sarah Williams

Numis Securities +44 207 260 1000

NOMAD: Lee Aston, Head of Corporate Finance

Corporate Broking: Charles Farquhar

Fairfax I.S. PLC +44 207 598 5368

Paul Richards, Head of Corporate Finance

Appendix

Project Highlights:

Development Project 1: Uppal IT Park - "Tech Oasis" 

Development Project 2: Rustomjee's Township 

Development Project 10: Luxor Cyber City - "SEZ" IT/ITES Development 

Development Project 13: MIG Bandra 

In May 2008, Trikona TC and SF invested £20.04 million to acquire 49% of a redevelopment project located within the MIG Bandra area in partnership with Rustomjee Construction Pvt. Ltd., the SPV promoted by Keystone Group, which holds the remaining 51% of the underlying asset. 

The project site is in close proximity to the Secondary Business District (SBD) of Mumbai known as the Bandra Kurla Complex, which is fast outgrowing the traditional/preferred Central Business District of Nariman Point. As more and more corporate offices are moving into the Bandra Kurla Complex, there is an increasing demand for quality residential real estate space in the adjoining areas.

Our percentage ownership in the project is also protected by any downturn in markets due to our first right of cash flow in the project returns.  

 

About Trikona Trinity Capital PLC:

 

Trikona Trinity Capital PLC (AIM: TRC) was listed on the London Stock Exchange as Trinity Capital in 2006, raising £250m of equity. The fund invests in real estate and infrastructure related entities across India, with a target size of between £5m and £30m per transaction. Becoming fully invested six months ahead of schedule, its investment strategy is unique - Trikona TC selects developers with a proven track record in the asset class or in the local market, with the specific notion of contributing to India's growth. The Company also adopts a socially aware attitude to development, investing in projects which will actively improve India's underdeveloped social and physical infrastructure. The Company is managed by Trikona Capital, a leading fund manager focused on investing in Indian real estate and infrastructure.

www.trikonatrinitycapitalplc.com

ENDTSTGUBDGDUGGGID