Convertible bonds were an exception, the company announced on Friday evening. To this end, the real estate group has agreed to provide secured external financing with a volume of EUR 937.5 million. The loan has a final interest rate of 12.5 percent and a term until June 30, 2025. It is intended to refinance financial liabilities of the Group and its subsidiaries, including Adler Real Estate and Consus Real Estate.

    The loan will be secured by the ADLER Group, it said. However, the provision of external financing is subject to a positive restructuring report, an adjustment to the bond conditions, the provision of the agreed collateral and other closing conditions customary in the market. In addition, the loan is linked to an equity instrument that entitles the holders to receive 25 percent of the company’s shares at an exercise price of EUR 0. If the subscription right is not served by the delivery of shares in the company within six years after drawing the funds under the external financing, a cash settlement will be made.

    According to Adler, the agreement for the adjustment of the bond conditions provides for a proportionate collateralisation of the bonds and an increase in the interest rate by 2.75 percentage points. Payment of all interest accrued since the relevant Last Payment Date shall be deferred prior to Effectiveness until July 31, 2025 and all interest shall be capitalized until then. In addition, the deadline for the publication of the audited consolidated financial statements for the 2022 financial year provided for in the bond conditions is to be extended to the end of 2023. The agreement also stipulates that the final maturity of the bond, which is due on July 26, 2024, is to be postponed by one year.

    At the same time, it was agreed that further financial liabilities can be taken out subject to certain restrictions. The ADLER Group undertakes not to make any dividends or other payments or to make distributions to its shareholders. The group of bondholders with whom ADLER has reached an agreement holds around 45 percent of the bonds issued. The group intends to conclude a corresponding agreement with a majority of its bondholders, it said. This should happen “promptly”. The adjustment of the bond conditions should take effect in the first quarter of 2023 at the latest.

    ADLER also announced that it would strengthen management with a restructuring expert. In order to support the financial stabilization process, the Board of Directors is to be expanded to include an additional non-executive member with extensive capital market experience. The candidates for both positions are to be coordinated with the bondholders.

    According to the announcement on the Tradegate trading platform, the ADLER Group share gained more than 40 percent compared to the XETRA closing price. The paper could not quite keep up these gains.

    The recovery of the past few weeks could thus continue on Monday. Since the record low of 1.253 euros in mid-October, the price has risen again significantly. In the medium term, however, the price gains are just a drop in the bucket. Because of the financial problems of the group, the course collapsed significantly. The price minus in the past twelve months adds up to more than 80 percent. Measured against the record high of almost 49 euros from the summer of 2018, the loss is more than 95 percent.

    The Vonovia housing group still holds around a fifth of the ADLER Group.



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