Aviva Investors and Capital & Regional have today confirmed that the proposed restructuring of the Mall Fund has been approved by investors and bondholders, in a proposal that represents one of the largest restructurings of CMBS since the financial crisis.
- Restructuring of £1bn debt and extension of fund is approved by investors and bondholders
- One of the largest property CMBS restructurings to take place post-crisis.
Aviva Investors and Capital & Regional have today confirmed that the proposed restructuring of the Mall Fund has been approved by investors and bondholders, in a proposal that represents one of the largest restructurings of commercial mortgage backed securities (CMBS) since the financial crisis.
The Mall Fund is a closed-end vehicle which invests in UK shopping centres and currently comprises 16 assets. Aviva Investors acts as the fund manager and Capital & Regional as the property and asset manager of the fund.
Over the past two years, the fund’s managers have focused on reducing leverage in the fund and generating cash in the face of falling UK real estate prices and challenging occupier markets. In order to continue with this commitment to deleveraging and to provide all stakeholders with the best opportunity to maximise their returns, the term of the Mall Fund and the maturity of the bonds have been extended. This will enable further orderly deleveraging and repayment of debt over the next five years.
The Mall Fund expects the restructuring to be implemented in the near future now that the key conditions have been fulfilled.
Sir Robert Finch, chairman of Mall Fund, commented: “We are delighted that the restructuring of the Mall Fund and its financing has been approved. We see this as a vote of confidence in the Mall Fund’s value to its bondholders and unitholders and would like to thank them for their continued faith in the fund as an investment proposition.”
Richard Jones, managing director of UK real estate at Aviva Investors commented: “Aviva Investors and Capital & Regional were committed to finding a solution to restructure the Mall Fund which would be agreeable to both debt and equity holders. There is a significant amount of real estate debt outstanding in the market, and we are pleased to have reached a solution for the Mall Fund that ensures it can continue to be managed prudently over the next five years and aim to maximise returns for all stakeholders.”
Morgan Stanley acted as financial advisor and consent solicitation agent and Berwin Leighton Paisner LLP as legal advisor to the Mall Fund.
-ends-
For more information contact:
Allister Fowler
Corporate Affairs
+44 (0)20 7809 8313
Notes to editors:
The Mall Fund is an unregulated collective investment scheme for the purpose of the UK Financial Services and Markets Act. Information regarding the scheme is therefore intended only for those to whom the scheme can be promoted under the Act. As this is an unregulated collective investment scheme all or most of the protections provided by the UK regulatory system do not apply and compensation under the Financial Services Compensation Scheme will not be available. Information regarding the scheme should not be regarded as constituting an offer to invest.
Aviva Investors
Aviva Investors is the global asset management business of Aviva plc. The company delivers investment management solutions, services and client-driven performance to clients worldwide. Aviva Investors operates in 16 countries in Asia Pacific, Europe, North America and the United Kingdom with assets under management of £250 billion at 31 December 2009.
Aviva plc
Aviva is the world’s fifth largest* insurance group, serving 53 million customers across Europe, North America and Asia Pacific.
Aviva’s main business activities are long-term savings, fund management and general insurance, with worldwide total sales of £45.1 billion and funds under management of £379 billion at 31 December 2009.
* Based on gross worldwide premiums for the year ended 31 December 2008