DGAP-Adhoc: IVG Immobilien AG: Development of a comprehensive refinancing strategy

IVG Immobilien AG / Key word(s): Capital Reorganisation/Restructure of Company

12.07.2013 20:06

Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted
by DGAP - a company of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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As announced on 31 May 2013, IVG Immobilien AG (IVG or Company) is
currently conducting negotiations with principal shareholders,
and all main creditors affiliated in 'Ad hoc-Committees' with regard to (i)
a loan agreement in the amount of EUR 1,350 million dated 25 September
2007/13 April 2012 (SynLoan I), (ii) a loan agreement in the amount of EUR
1,047.4 million dated 12 May 2009/24 February 2012 (SynLoan II), (iii) the
convertible bond (ISIN: DE000A0LNA87) and (iv) the hybrid bond (ISIN:
DE000A0JQMH5) about the development and implementation of a comprehensive
refinancing strategy. From the Company's perspective, the basis of the
comprehensive refinancing concept, still to be agreed, will be the
following:

1. The Business Plan Scenario for 2013 to 2018 (Business Plan Scenario)
passed by the board of IVG: According to the Business Plan Scenario the
board assumes that IVG Group will, medium term and continuously growing
during the projection period, achieve an EBIT of solidly more than EUR
200 million per year due to a consistent focus on the strengths of
IVG's business model as an integrated platform of investment and funds
business for real estate and infrastructure (caverns) combined with

i. a strategic focus and, if necessary to achieve return ratios well
at market standard and in order to avoid negative effects on
earnings in the future due to unrealised changes in value, a
partial revaluation of the real estate portfolio including the sale
of approx. 60 minor, non-strategic properties until 2016 (the THE
SQUAIRE ensemble will presumably be transferred into IVG's
investment portfolio) and increased, value-adding investments in
IVG's real estate portfolio (as of 2015, approx. EUR 50 million
annually),

ii. the realisation of (already agreed) sales of caverns in the amount
of approx. EUR 500 million and, depending on demand due to signed
rental agreements, moderate new developments of additional caverns
for IVG's portfolio until 2018 (probably one oil cavern and two gas
caverns),

iii. the expansion of the funds business primarily together with
institutional and semi-institutional investors, aiming at a net
growth of assets under management of approx. EUR 500 million to EUR
700 million p.a.; in particular, as of 2015, - based on successful
co-investments in the past (Protect Fonds, Premium Green Fonds, IVG
Kavernenfonds I/II, Silberturm) - approx. EUR 100 million per year
shall be available for co-investments, which, with additional
investors' resources, might result in additional assets under
management of up to EUR 1,000 million per year,

iv. additional cost savings and increased efficiency in the amount of
approx. EUR 25 million per year.

These projections in the Business Plan Scenario will probably need to be
adjusted after the strategic review of all business divisions and their
asset valuations as currently conducted by the Company as mentioned in the
ad hoc announcement dated 31 May 2013. At present, the Company cannot rule
out that (near-term) value adjustments might add up to an amount that
requires a notice of loss of half of the Company's share capital (para. 92
sec. 1 German stock corporations act).

2. A preliminary indicative liquidity analysis: The analysis comes to the
conclusion that - according to current projections and estimations,
regarding, inter alia, the feasibility of specific liquidity
optimisation measures, which might need to be adjusted in the future -
an expected liquidity need of approx. EUR 120 million, not yet met and
possibly posing a risk to the company as a going concern, might arise
between October 2013 and March 2014. This is in particular attributable
to (i) the shutdown of the automated zero-balancing cash pool as a
measure of legal precaution in the light of the deteriorated overall
situation of the group and (ii) the high costs related to the
restructuring to be borne by the Company. Prior to the implementation
of the comprehensive refinancing, the Company could receive a bridge
loan, on which the Company is currently holding negotiations with
creditors already invested.

3. An analysis of the estimated satisfaction quota of the different groups
of creditors and the remaining liquidation proceeds for the
shareholders in the event of IVG group's insolvency induced liquidation
('Entity Priority Model' - EPM) conducted by an international audit
firm mandated by the Company: The EPM calculated that the satisfaction
quota in specific liquidation scenarios of the IVG Group will
presumably be - inter alia depending on (i) the level of legal
enforceability of various securities granted to the individual
creditors presumed in each liquidation scenario (ii) the estimated
proceeds from the granted securities - (i) between approx. 46 to
approx. 55 percent (SynLoan I), (ii) between approx. 86 to approx. 89
percent (SynLoan II), (iii) between approx. 27 to approx. 41 percent
(convertible bond) and (iv) between approx. 96 to approx. 100 percent
(Carve-out debt). The creditors of the hybrid bond and the shareholders
of the Company will probably not receive any satisfaction in these
scenarios. The calculated satisfaction quotas are based on credit
volumes as per 31 December 2012. In so far, made/agreed repayments for
the SynLoan II need to be taken into account.

The aim of the Company remains to accomplish an agreement on a
comprehensive restructuring concept short term, possibly supported by all
main creditors and shareholders of the Company. Key issues of a consensual
solution with major creditors should be agreed prior to sending out of the
invitation to the annual general meeting of shareholders to the federal
gazette, so they can be submitted to the vote of the shareholders in the
annual general meeting 2013.

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Language: English
Company: IVG Immobilien AG
Zanderstr. 5-7
53177 Bonn
Germany
Phone: +49 (0)228 844-400
Fax: +49 (0)228 844-372
E-mail: ir@ivg.de
Internet: www.ivg.de
ISIN: DE0006205701, DE000A0JQMH5
WKN: 620570, A0JQMH
Listed: Regulierter Markt in Berlin, Düsseldorf, Frankfurt (Prime
Standard), München; Freiverkehr in Hamburg, Hannover,
Stuttgart

End of Announcement DGAP News-Service

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