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«Land Securities Group PLC today announces that it has reached agreement to sell Land Securities Trillium ("Trillium") to Telereal, the property investment and services company, for a total headline consideration of £750 million. The sale does not include the Accor hotel portfolio which will remain within Land Securities. The sale is expected to complete on 12 January.
Cash proceeds of £444 million will be received upon completion and used to reduce Group net debt in line with the priorities outlined by Land Securities at its half-yearly results in November which included the selected sale of assets to maintain the strength of its balance sheet.
The headline enterprise value of £750 million is based on Trillium’s balance sheet (excluding the Accor hotels) as at 31 March 2008. Land Securities will receive cash proceeds of approximately £444 million upon completion, with a further £25 million of cash being deferred by up to 24 months. Net external debt of £49 million will be assumed by the purchaserof Trillium. Around £232 million of cash has already been generated by Trillium since 31 March 2008 from operations and disposals and the majority paid to Land Securities. As part of the transaction, Land Securities has undertaken to make available on completion a loan of £50 million (on market terms) to the Trillium Investment Partners fund. The transaction generates a loss of approximately £340m on the date of disposal.
The gross assets of Trillium (excluding Accor) were £1,575 million as at 31 March 2008 and £1,291 million as at 30 September 2008. The capital employed in Trillium (excluding Accor) was £1,163 million as at 31 March 2008 and £896 million as at 30 September 2008. Trillium (excluding Accor) generated underlying operating profits for the year to 31 March 2008 and six months to 30 September 2008 of £102 million and £47 million respectively.
Ian Ellis, Chief Executive of LST, will step down from the Land Securities Board on completion of the transaction» (CS della Società).
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