Euronext-listed Prologis European Properties (PEPR) has received approval from the bank syndicate on its EUR 258 mln senior unsecured corporate term loan to partially remove restrictions on dividend payments. As a result, the decision over when to resume paying ordinary dividends is now solely in the hands of the business.
Euronext-listed Prologis European Properties (PEPR) has received approval from the bank syndicate on its EUR 258 mln senior unsecured corporate term loan to partially remove restrictions on dividend payments. As a result, the decision over when to resume paying ordinary dividends is now solely in the hands of the business.
In a statement, both the board and management company of PEPR said they have reaffirmed their intent to continue to retain distributable cash flow for the foreseeable future in order to further deleverage the balance sheet.
Peter Cassells, chief executive officer of PEPR, commented: 'We are pleased to receive this vote of confidence from our bank syndicate which reflects the progress we have made in improving our liquidity profile and reducing our overall debt levels. Our focus remains firmly fixed on deleveraging the business and returning to investment grade.'
Under the agreed terms, PEPR may pay out up to 50% of distributable cash flow in dividends regardless of its credit rating. Once an investment grade credit rating has been attained, PEPR will then be in a position to distribute up to 90% of its cash flow as dividends.
In addition, the Tangible Net Worth covenant has been reduced to a minimum of EUR 900 mln from EUR 1 bn. The margin on the credit facility remains unchanged, currently at 270 basis points over Euribor or Libor.