EfTEN Real Estate Fund III AS established a 100% subsidiary in Estonia with the business name EfTEN Kolmas OÜ. The management board members of the subsidiary are Viljar Arakas and Tõnu Uustalu. The company has no supervisory board.
Founding the subsidiary cannot be interpreted as acquiring of a major holding for the purposes of the NASDAQ OMX Tallinn Rules and Regulations section "Requirements for Issuers". The members of the Management Board and Supervisory Board of EfTEN Real Estate Fund III AS have no other personal interest in the transaction.
The purpose of establishing a subsidiary is to acquire the following four registered immovables with a car sales and service center and parking areas. The registered immovable will be acquired from the ABC Vara AS, based on the contract of sale signed 14.12.2018:
1) a registered immovable located Mustjõe 1 and Paldiski mnt 105 in Tallinn (registry no. 1976101, consisting of two cadastral units: cadastral number 78406: 601: 6830, area 1247m² and cadastral number 78406: 601: 6840, area 4419m²);
2) a registered immovable located Mustjuure 6 in Tallinn (registry no. 1976701, cadastral no. 78406:601:4520, area 1795m²);
3) 1/2 of the registered immovable located Mustjõe 3 in Tallinn (registry no 3717201, cadastral no. 78406: 601: 4850, total area of the registered immovable 695 m²);
4) 1200/2694 of the registered immovable located Paldiski mnt 97 in Tallinn (registry no 11149501, cadastral no 78406: 601: 6750, total area of the registered immovable 2694 m²; according to the agreement of the co-owners, the seller has a sole use of 1200 m²).
The price for registered immovables without VAT is 3,0 million euros. The transaction will be financed up to 65% with bank loan. Closing of the acquisition is dependent on receipt of merger clearance from the Estonian Competition Authority. The financial volume of the transaction is less than 3% of the Fund's current assets. The net entrance yield is 8 percent, not considering the bank loan.
The registered immovables will be leased by ABC MOTORS AS, a subsidiary of the ABC Group, on the basis of a ten-year lease agreement, which is entitled to extend twice for five years.
Viljar Arakas
Member of the Management Board
Phone 655 9515
E-mail: viljar.arakas@eften.ee