Kungsleden to buy NR Nordic & Russia assets for EUR 400m

Listed Swedish property company Kungsleden has signed a letter of intent to acquire the majority of the properties held by Amsterdam-listed NR Nordic & Russia Properties for a total of SEK 3.6 bn (EUR 400 mln).

The transaction entails 40 properties divided between two portfolios. The Non-Russian portfolio comprises 36 office and industrial assets, of which 33 are in Sweden, one in Germany and two in Poland. They offer 825,000 m² of leasable space, and generate a rental income of SEK 563 mln.

The Russian portfolio consisting of four properties and representing a further SEK 840 mln in value, will be sold to NR Nordic & Russia's shareholder, Thomas Lindeborg through a fully secured back-to-back agreement.

'The board of directors believes the proposed transaction represents a highly-attractive opportunity to return substantial value to shareholders,' said NR Nordic & Russia's chairman David Hunter. 'We are delighted to be engaging with such a highly-reputable company as Kungsleden and look forward to working with them to complete this sale.' The transaction is supported by the five largest shareholders in NR Nordic and Russia Properties; London & Regional, Weiss Asset Management, Laxey Partners, QVT Fund, as well as Thomas Lindeborg. Together they represent 71% of the shares.

The transaction is due to be completed by March 31, 2011 in respect of the non-Russian assets, and by September 30, 2011 in respect of the Russian Assets.

'I'm very satisfied that we have acquired an attractive portfolio with a good property yield. It has been an advantage for us to be able to provide NR with a solution for the entire portfolio,' said Kungsleden's Chief Executive Thomas Erséus.

Separately, Kungsleden announced the purchase of 12 commercial properties for a total purchase price of SEK 683 mln. The properties consist of six office, retail and warehouse in prime sites in Malmö, four buildings held by Hemsö, its 50% joint venture with AP3 (the Swedish third pension insurance fund) in Skara, south-western Sweden, as well as two commercial properties in Tumba, south west of Stockholm.