Arco Investeeringute AS, a 100% subsidiary of AS Arco Vara has sold its 50% share in the joint venture and owner of Ahtri 3 land plot Arco HCE OÜ to Ahtrimaa OÜ, the other 50% shareholder of the joint venture. In the framework of the transaction the credit relations related to Ahtri 3 were restructured and all court disputes between Danske Pank on the one hand and Arco HCE, Arco Investeeringute AS and Ahtrimaa OÜ on the other hand become amicably settled. Ahtrimaa OÜ belongs to U.S. Invest group.
Guarantee issued by Arco Investeeringute AS to Danske Bank in relation to Ahtri 3 property loan ceased. Arco Vara group is has no rights nor obligations related to Arco HCE OÜ or to Ahtri 3 land plot.
The Group’s cashflow from the transaction is positive, but not in significant amount. As a result of the transaction, Arco Vara will reverse the provision in amount of 1.9 million euros that was created to cover the possible liabilities arising from the Danske Bank guarantee. The reversal of guarantee will impact positively Arco Vara’s 2013 Q4 profit statement by 1.9 million euros.
CEO of Arco Vara comment: „The parties have been making intense efforts to normalise the financial structure of Ahtri 3 project since end of 2012, even recurring to the court with several cases. Today one should compliment both Danske Bank and U.S. Invest, and we wish at foremost the team of U.S. Invest success in continuous execution of such a huge challenge in real estate development. From the viewpoint of Arco Vara, as of today we have resolved the last one in the list of critical problems that were facing us, as I also pointed out in the 31th January webinar presentation. We have freed up resources which can be now directed into our own projects.“
Marko Err
CFO
Arco Vara AS
Tel: +372 614 4503
marko.err@arcovara.ee
http://www.arcorealestate.com