Plaza Centers: Take II

So last week, we noted the sudden sale of some land in Prague 3 by Plaza Centers. For everyone who was wondering what the sudden rush was comes the news that S&P has downgraded the company as of today from to ilB from ilBB+. And it turns out it’s all about the speed of sales.

•Since the last rating activity in March 2013, the Company agreed on several
transactions but we estimate that the realization pace is insufficient to catch up with
significant gap between the sources available today for repayment and the expected
repayments in the coming 12 months.
• In our estimate, without a significant acceleration of the realization pace it appears that
the Company will find it difficult to repay its debts already in the coming 12 months.

PC’s got to raise €31m by the end of the year, and €63m by June 2014. S&P isn’t ready to bet the bank any more on that happening. And it suggests you don’t either.

Plaza Centers sells “Prague 3”

Well now, this is interesting:

“Plaza Centers announces it has successfully completed the sale of 100% of its interest in a vehicle which holds the interest in the Prague 3 project (“Prague 3”), a logistics and commercial center in the third district of Prague. Earlier this year, Plaza completed its successful application to change the zoning use of Prague 3 to a residential scheme. The transaction values the asset at circa €11 million and, as a result, further to related bank financing and other balance sheet adjustments, Plaza has received cash proceeds of net circa €7.5 million.

Ran Shtarkman, President and CEO of Plaza Centers N.V., said:
“Less than two months after our first exit in India, we are pleased to announce the sale of our holding in Prague 3 in the Czech Republic. The sale is in line with our strategy and disposal programme of deleveraging and reallocating realised capital from stabilised completed projects and non-core assets to the core yielding assets across our portfolio.”