Metrovacesa to Sell Gecina Stake for 1.55 Billion Euros

Metrovacesa SA, once the biggest Spanish property developer by market value, agreed to sell its 27 percent stake in French developer Gecina SA for 1.55 billion euros ($2.11 billion).

Institutional investors including Blackstone Group LP will buy 16.8 million Gecina shares for 92 euros each, a 10 percent discount to the Paris-based company’s net asset value, Metrovacesa said in a statement today. The transaction is likely to be completed between the end of July and the end of September, according to the Madrid-based company.

Norges Bank will acquire 9 percent of all Gecina shares, Credit Agricole Assurances will buy 4.7 percent, a jointly owned affiliate of Blackstone and Ivanhoe Cambridge Inc. will buy 6.9 percent and a Blackstone affiliate will purchase 1.5 percent, Metrovacesa said.

The jointly owned Blackstone-Ivanhoe affiliate already owns 23 percent of Gecina and will sell shares as needed to avoid holding 30 percent of the stock, New York-based Blackstone said in a separate statement. Reaching that ownership level forces an investor to bid for the remaining shares under French law.

Metrovacesa bought control of Gecina in 2005 for 5.18 billion euros. In February 2009, six Spanish banks took control of Metrovacesa in a debt-for-equity swap. In 2010, Metrovacesa offered its Gecina stake, which had dropped to 27 percent, as backing for a syndicated loan, on which it broke its covenants.

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