Ishaan Real Estate PLC Update on tax review process (5330D)
30 April 2013 - 4:02PM
UK Regulatory
TIDMISH
RNS Number : 5330D
Ishaan Real Estate PLC
30 April 2013
30 April 2013
Ishaan Real Estate Plc
("Ishaan Real Estate" or the "Company")
Update on tax review process and other transaction
amendments
On 21 February 2013, Ishaan Real Estate announced the proposed
sale of the Company's entire Property Interests to Chalet Hotels
Private Limited, a member of the K Raheja Corp Group, and other
entities connected with K Raheja Corp Group, for an aggregate
consideration of approximately GBP70.3 million in cash (the
"Disposal"). The Disposal was subsequently approved by Shareholders
on 11 March 2013.
The Disposal remained conditional upon the obtaining of a nil
withholding tax certificate from the Indian tax authorities
confirming that no withholding tax is required to be deducted at
source in relation to the consideration payable to the Group for
the sale of the Property Interests. At the time of the original
announcement on 21 February 2013, it was expected that this
condition precedent to the Disposal would be satisfied by 28 March
2013. On 26 March 2013, Ishaan Real Estate announced that while
progress had been made towards obtaining the nil withholding tax
certificate, the Board had been advised that this process was now
expected to be completed by the end of April 2013. As a result, the
Board agreed to extend the long stop date for the satisfaction of
this condition precedent to 30 April 2013.
The Board has now been informed that the review process by the
Indian tax authorities has been completed and that the Indian tax
authorities have confirmed that withholding tax equivalent to
approximately GBP1.1 million is payable in respect of the Disposal.
This amount will therefore be deducted at source by the Purchasers
from the consideration payable to the Company in respect of the
Disposal. The terms of the Share Purchase Agreements have been
amended, as envisaged in their terms, to allow completion to
proceed notwithstanding that the nil withholding tax condition in
respect of the Disposal was not satisfied.
All the other terms and conditions of the Disposal remain as set
out in the circular sent to Shareholders on 22 February 2013 (the
"Circular").
Sale of Mauritian subsidiaries
Neerav Investment Advisory Services (Dubai) Limited ("Neerav")
or an affiliate of Neerav has committed to acquire from I Holding
Company (Mauritius) Limited, subsequent to the Initial
Distribution, the Mauritian subsidiaries owned by I Holding Company
(Mauritius) Limited for an expected consideration of approximately
GBP700,000. Following distribution of the proceeds by I Holdings
Mauritius, the Company will be able to retain the proceeds of this
sale as cash available for subsequent distribution to
Shareholders.
Potential sale of trademarks held by the Group
In addition, the Company is in discussions whereby Neerav, or an
affiliate of Neerav, may acquire from the Company the trademarks
held by the Group in respect of the Ishaan Real Estate brand name.
It is anticipated that this sale of trademarks could raise cash
proceeds of up to GBP250,000, which would then be available for
distribution to Shareholders. There is no guarantee that any such
sale will occur.
Impact on quantum and timing of distributions to
Shareholders
The above is expected to have a limited impact, if any, on the
quantum of distributions to Shareholders. The Board now expects to
make the Initial Distribution of 50 pence per Ordinary Share in
July 2013 and the Final Distribution of up to 1 pence per Ordinary
Share by July 2014.
It remains the intention of both parties for completion to occur
in accordance with the agreed terms.
Defined terms in this announcement have the same meanings as set
out in the Circular.
Enquiries:
Deutsche Bank AG, London Branch (NOMAD and broker to the Company)
Ben Lawrence
John O'Driscoll
Tel: +44 20 7545 8000
College Hill (PR advisers to the Company)
Mike Davies
Tel : +44 20 7457 2020
Email: mike.davies@collegehill.com
Deutsche Bank AG is authorised under German Banking Law
(competent authority: BaFin - Federal Financial Supervising
Authority) and authorised and subject to limited by the Financial
Conduct Authority (the "FCA"). Details about the extent of Deutsche
Bank AG's authorisation and regulation by the FCA are available on
request.
Deutsche Bank AG is acting for the Company and no one else in
connection with the Disposal and will not be responsible to anyone
other than the Company for providing the protections afforded to
clients of Deutsche Bank nor for providing advice in connection
with the Disposal.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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