Orco raises €7m in new capital

In a move Reuters says is being seen as a step to protect itself from a take-over by activist shareholders, Orco Property Group has raised €7m in new capital.

On April 8, 2010, the Board of Directors approved a private placement of 7.1 million EUR in the form of a reserved capital increase of its authorized capital in favour of Alandia Investissements, Neptune Invest s.a.r.l. and Lansdowne Capital s.a (an affiliate of SPQR Capital) for 20 000, 400 000, and 1 000 000 shares respectively at a price of 5.00 EUR per share where 0.9 EUR per share corresponds to a share premium. The foregoing investors subscribed to the capital increase on April 9, 2010.

The announcement follows €6m raised last week. On his April 12 blog post, Ott rejects accusations that the capital increase isn’t legal, and that that it’s a reaction to the battle for control at Orco.

“The reason is a technical one: Luxembourg law allows, each year, a capital increase equal to 10% of the company’s capital, whose shares are tradeable without a prospectus. This regards the capital increase transacted with Axa Talents and Neptune Invest last week.”

The annual general assembly has now been called for April 29, just three days after one to be held at the request of the shareholders surrounding Millenius. Going to be a busy month.

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