REUBEN BROTHERS TO PROVIDE MORE THAN £250M IN EQUITY AND DEBT FINANCE FOR CHELSFIELD DEAL
26 January 2004 - London
The British investors, the Reuben Brothers, have taken a major stake in the buy-out of the property development company, Chelsfield plc. Their 35.4 per cent share in the new business makes them the largest investor in the company.
Of the deal, the Reuben Brothers said: “We are delighted that we have been able to become a major part of what will, we are sure, become an ever more important player in the UK property market. After more than 30 years experience in that market, we look forward to working with Elliott and his management team to develop further this first class property portfolio.”
The purchase of the stake was conducted through Aldersgate Investments Limited, a company ultimately owned by David and Simon Reuben.
Aldersgate operates as a holding company for property related investments and the existing portfolio consists of investments in the United Kingdom, Jersey and Monaco.
Aldersgate has firmly committed to fund Duelguide, the company which acquired Chelsfield, in the amount of £140 million. It has also agreed to underwrite approximately £6.4 million worth of Duelguide Units for cash. The terms of Aldersgate's subscription have been enhanced compared to all other providers of equity and subscribers for Duelguide Units to reward it for its total funding commitments. In addition to the equity participation, the Reuben Brothers will receive some 6% of Duelguide Fully Diluted Share Capital. A wholly owned subsidiary of Aldersgate will own part of its investment in Duelguide Shares. The Reuben Brothers will also be participating in the mezzanine finance. The proportion of mezzanine they are providing is equal to the percentage of equity participation.
Following the Offer becoming or being declared unconditional in all respects, Aldersgate, together with its wholly owned subsidiary, will be the beneficial owner of up to approximately 35.4 per cent. of Duelguide’s Fully Diluted Share Capital, subject to scale back as a result of take-up of the Unit Alternative.
David and Simon Reuben hold significant investments in businesses that have some kind of tangible assets; they also hold substantial liquid reserves and are currently looking at a number of new business ventures.
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Recent business activity has involved a bid for Selfridges in conjunction with Tom Hunter; they also provided the funding for the acquisition of a 50.4% stake in the rail transportation specialist, ERMEWA Group. ERMEWA Group is the world's second largest provider of tank container rentals and Europe's second largest provider of specialised railcars as well as support logistical services. It has an annual turnover of approximately EUR 400 million. French State Railways, SNCF, own the other 49.6% of ERMEWA.
The Reubens have also been involved many substantial UK property purchases last year, and achieved the biggest single largest let in the West End in 2003 when the Audit Commission took space at Millbank Tower, which is owned by the brothers.
For further information, please contact
Charles Stewart-Smith on 020 7618 9100 or 07900 492515.