IVG Immobilien AG / Release of an announcement according to Article 37x of the WpHG [the German Securities Trading Act]
30.07.2014 10:54

Interim report according to Article 37x of the WpHG, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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The business performance of IVG Immobilien AG (ISIN DE0006205701) in the first quarter of the 2013/2014 financial year was influenced in particular by the significant event of the initiation of insolvency proceedings over the company's assets on 1 November 2013.

The company's application for the initiation of insolvency proceedings under self-administration was approved by way of a decision of the Bonn Local Court dated 1 November 2013, thereby allowing the further restructuring to take place on the basis of an insolvency plan devised by the Board of Management. The Düsseldorf lawyer Horst Piepenburg was appointed as the administrator, having previously been appointed as the preliminary administrator by way of a decision by the Local Court dated 21 August 2013. The initiation of insolvency proceedings also represented the start of a new financial year of the company (section 155 (2) of the German Insolvency Code (InsO)).

In the following months, the Board of Management devised an insolvency plan aimed at the financial and operational restructuring of IVG Immobilien AG.
At the heart of the financial restructuring as part of the insolvency plan proceedings is the conversion of receivables from the company into shares in the company in the context of a non-cash capital increase ('debt/equity swap').

The capital reduction to zero as part of the debt/equity swap that is set out in the constructive part of the insolvency plan will mean that the company is no longer listed on the stock exchange. Irrespective of this, the company submitted an application to the Frankfurt Stock Exchange to be moved from the Prime Standard to the General Standard of the Regulated Market following the end of the reporting period.

The insolvency plan does not contain any provisions on the subordinated liabilities of the company arising from the hybrid bond (ISIN: DE000A0JQMH5), meaning that these liabilities are considered to have been waived upon the entry into legal effect of the court decision approving the initiation of insolvency proceedings in accordance with the provisions of the InsO (section 225 (1) InsO).

In the period under review, the company's Board of Management also initiated the operational restructuring with the aim of optimising the Group's corporate and cost structure.

In addition to the discontinuation of the Private Funds division and a further headcount reduction to a total of 320 employees (FTEs), the operational restructuring involves structuring IVG Immobilien AG and its existing subsidiaries IVG Institutional Funds GmbH and IVG Caverns GmbH as separate and independently operating companies. The necessary reconciliation with the employee representatives of the various companies was completed shortly after the end of the reporting period. The reporting date for the creditors' meeting in accordance with section 156 InsO was on 13 December 2013: The Board of Management reported to the creditors on the status of the proceedings, the reasons for the crisis, the financial and operational status quo and the plans for the restructuring of IVG Immobilien AG. The creditors' meeting unanimously approved the continuation of self-administration at the company. Following the end of the first quarter of 2013/2014 on 31 January 2014, the insolvency plan devised by the company was submitted to the responsible Bonn Local Court for inspection by the parties concerned. At the discussion and voting meeting on 20 March 2014, all of the groups (eight creditor groups and the shareholder group) approved the insolvency plan with the required majorities. The Bonn Local Court approved the insolvency plan by way of a decision dated 13 June 2014; the certificate confirming the legal effectiveness of this decision was issued on 15 July 2014.
Furthermore, the conclusion of an agreement on the provision of debtor-in-possession financing in mid-December 2013 served to safeguard the financing of the planned further restructuring measures, the insolvency proceedings and the company's business operations until the planned end of the insolvency proceedings. Subsidiaries whose own financing or financing by IVG Immobilien AG was affected by the insolvency in the form of grounds for termination were able to prevent encroachment on their assets and maintain their financing by entering into non-realisation and standstill agreements.

On 22 November 2013, a standstill agreement was entered into between IVG Immobilien AG and 14 property companies belonging to the 'Pegasus portfolio' for the Pegasus financing that was scheduled for repayment on 31 October 2013. This agreement incorporates various extensions and has a term until 30 September 2014.

Following various extensions, the standstill agreement with the core portfolio banks now also runs until 30 September 2014. Both of these financing arrangements are scheduled to be replaced in September 2014.
With regard to the financing for THE SQUAIRE that expired on 31 December 2013, the agreements dated 10/17 January 2014 and 23/28 July 2014 set out a standstill agreement by 30 September 2014.

The moratorium on the financing for THE SQUAIRE Parking was extended from 31 December 2013 to 30 September 2014 subject to the condition of partial repayments in the form of two successive agreements.
In addition, an eight-figure amount of a property financing arrangement of IVG Immobilien AG was repaid on 30/31 January 2014 following the sale of the 'Implerstrasse' property.

In the IVG Caverns division, the renegotiation of a master lease agreement led to a reduction in the number of caverns planned for the lessee in question from six to three. One of these caverns was already handed over in 2013, while the handover of a further two caverns is now scheduled for 2017; the planned handover of a further three caverns in 2016/2017 will no longer take place. The fact that these three caverns will no longer be let and completed will have a correspondingly negative impact on the future results of operations of IVG Caverns GmbH in 2016 and 2017.
Beyond this, the period under review was characterised by stability in the company's operational business and the macroeconomic environment.
Bonn, 30 July 2014

The Board of Management



30.07.2014 The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de

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Language:     English
Company:      IVG Immobilien AG
              Zanderstr. 5-7
              53177 Bonn
              Germany
Internet:     www.ivg.de
 
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