International law firm Simmons & Simmons advised Growthpoint Properties Limited, a South African REIT listed on the JSE, on its EUR186.4m subscription for 23,300,000 ordinary shares in AIM listed Globalworth Real Estate Investments Limited, a real estate investment company active in Central and South East Europe with a primary focus on Romania. The transaction completed on 20 December 2016, and Growthpoint now holds a 26.88% stake in Globalworth.
Globalworth Real Estate Investments Ltd issued shares at a premium to Growthpoint Properties Ltd and Oak Hill Advisors (Europe) LLP to raise a total of EUR200m.

The transaction will enable Growthpoint to invest in an established, high-quality real estate company active in Central and South East Europe, regions which are expected to benefit from the growing demand for office and industrial real estate, on the back of strong gross domestic product growth as well as the rapid expansion of a young, skilled working population.

The investment will also facilitate the completion of Globalworth’s development projects and further unlocks potential new pipeline acquisition opportunities, initially in Romania and thereafter across the broader Central and Southeast Europe regions. Furthermore, as an anchor investor committed to the long term growth of Globalworth, Growthpoint can introduce access to new sources of funding for Globalworth, as well as access to Growthpoint’s institutional knowledge base through its representation on the Globalworth board of directors and investment committee. The investment will also provide Globalworth an increased ability to raise funds from international debt capital markets at an attractive cost.

Commenting on the transaction, Patrick Graves, said: “Simmons & Simmons is delighted to have advised Growthpoint, the largest South African primary listed REIT, on this transaction which is only its second equity investment outside South Africa and one which is expected to be transformational for Globalworth”.

Norbert Sasse, Chief Executive Officer of Growthpoint, commented: “This transaction marks an exciting development for Growthpoint, and we are hugely appreciative of the first class support we received from the Simmons & Simmons team throughout the process.”

Corporate partners Patrick Graves and Ed Baker led the Simmons & Simmons team assisted by corporate associate Samantha Darby and by a real estate finance team led by Simon Kildahl comprising Robert Farrer-Brown and Nikolai Hoffman.