Statement by the board of directors of Victoria Park regarding Starwood Capital Group’s cash offer to the shareholders of Victoria Park
The board of directors  (the ”Board”) of Victoria Park AB (publ) (”Victoria Park”) recommends the shareholders of Victoria Park not to accept Starwood’s offer as regards the ordinary shares of class A and B but to accept the offer as regards the preference shares.
This statement is made by the Board pursuant to clause II.19 of Takeover rules for Nasdaq Stockholm and Nordic Growth Market NGM (the ”Takeover Rules”).
On 1 April 2018, Starwood Capital Group ("Starwood"), through an affiliate, HomeStar InvestCo AB  (“HomeStar InvestCo”), announced a public cash offer to the shareholders of Victoria Park to tender all their shares to HomeStar InvestCo (the “Offer”). Victoria Park’s shares are listed on Nasdaq Stockholm, Mid Cap.
HomeStar InvestCo offers SEK 34.40  in cash for each ordinary share of class A and B respectively and SEK 315.00  for each preference share in Victoria Park. The total value of the Offer is approximately SEK 8,680 million.
The Offer does not include any warrants issued by Victoria Park to its employees under any incentive program implemented by Victoria Park. HomeStar InvestCo intends to procure fair treatment of participants in such programs in connection with the Offer.
The impact of the Offer on employees etc.
Under the Takeover Rules, the Board must, on the basis of Starwood’s statements in its press release regarding the Offer, present its opinion regarding the impact that the implementation of the Offer may have on Victoria Park, particularly in terms of employment, and its opinion regarding Starwood’s strategic plans for Victoria Park and the effects it is anticipated that such plans will have on employment and on the locations where Victoria Park conducts its operations.
The Board notes that in its press release regarding the Offer, HomeStar InvestCo states that Starwood intends to preserve the good employee relations and strong culture that exists at Victoria Park. Further, it is stated that, on the basis of Starwood’s knowledge of Victoria Park, its strategy and the current market conditions, it is HomeStar InvestCo’s intention to work with the existing management team and employees to develop and expand Victoria Park as an important part of the worldwide real estate activities of Starwood. HomeStar InvestCo has also stated that the profile and nature of Victoria Park fit Starwood’s investment criteria and provides an opportunity for Starwood to enter the rented residential sector in Sweden and that Starwood considers itself an appropriate investor to back Victoria Park in the next phase of its development and growth.
The Board assumes that this description is correct and has in relevant respects no reason to take a different view. The Board’s view is therefore that HomeStar InvestCo’s strategic plans for Victoria Park are in line with the current strategy of Victoria Park’s management and that HomeStar InvestCo will not make any material changes which affect the employment for Victoria Park’s employees or the locations where Victoria Park conducts its operations.
The Board’s recommendation
The Board’s opinion regarding the Offer is based on an overall assessment of a number of factors which the Board has considered relevant for the evaluation of the Offer. These factors include, but are not limited to the following:
- Victoria Park’s present position, expected future development in the light of the business plan which is based on Victoria Park’s proven growth model and possibilities and risks related thereto.
- Victoria Park’s average annual growth in net asset value, excluding dividends on ordinary shares, during the last three years, which has amounted to 49 per cent. Growth is driven by Victoria Park’s business model which is based on active management, value-creating development and acquisitions of residential properties with significant value potential.
As part of the Board’s evaluation of the Offer, the Board has engaged Handelsbanken Capital Markets (“Handelsbanken”) as financial advisor. The Board has also commissioned Handelsbanken to provide a valuation opinion (so-called fairness opinion) regarding the financial reasonableness of the Offer.
According to the valuation opinion, which is attached to this press release, Handelsbanken’s opinion is that the Offer, subject to the conditions and assumptions stated in the opinion, is not fair to the holders of shares of class A and B in Victoria Park, but fair to the preference shareholders of Victoria Park.
In light of the above it is the Board’s opinion that the Offer does not reflect Victoria Park’s full value. All board members which are not disqualified (cf. footnote 1) therefore unanimously recommend shareholders in Victoria Park not to accept the Offer as regards ordinary shares of class A and B but to accept the Offer as regards preference shares.
This statement shall in all respects be governed by and construed in accordance with Swedish law. Any dispute arising out of or in connection with this statement shall be settled exclusively by Swedish courts.
For further information, please contact
Chairman of the board Bo Forsén, +46 70 632 86 50, firstname.lastname@example.org
The information contained in this press release is such information that Victoria Park AB is obliged to disclose according to the EU Market Abuse Regulation and the Takeover Rules. The Information was submitted for publication, through the agency of Bo Forsén, on 13 April 2018, 08.30 CET.
Victoria Park AB (publ) is a listed property company, which, through long-term management and social responsibility for more attractive living, creates value in an expanding property portfolio in growth districts in Sweden.
Victoria Park's property portfolio amounts to 1,062,000 square metres, comprising 13,500 flats, with a market value of SEK 15.4 Bn. The shares in Victoria Park are listed for trading on Nasdaq Stockholm Mid Cap.
Victoria Park AB (publ) Box 2, SE-201 20 Malmö, Tel +46 40 16 74 40, Reg. no 556695-0738, Head office Malmö, www.victoriapark.se/english
 Board members Greg Dingizian and Isabelle Wikner have, through affiliates, irrevocably undertaken to accept the Offer, which means that they are disqualified from the Board of Directors of Victoria Park in dealing with issues related to the Offer. Consequently, they have not participated in the Board’s decision. The board has set up a Bid Committee, consisting of the chairman of the board Bo Forsén and board members Lennart Sten and Henrik Bonde, to deal with issues related to the Offer. In this statement, the “Board” refers to the board of directors of Victoria Park, excluding Greg Dingizian and Isabelle Wikner.
 A wholly owned, indirect subsidiary of SOF-11 International, SCSp, part of a collection of entities known as Starwood Opportunity Fund XI and a controlled affiliate of Starwood.
 The Board of Directors of Victoria Park has proposed to the 2018 Annual General Meeting to resolve on a dividend distribution of SEK 0.40 per ordinary share with record date 26 April 2018. In the event that Victoria Park pays dividends or executes any other value transfer to its shareholders of ordinary shares, for which the dividend record date occurs before settlement in the Offer, the cash consideration of the Offer will be reduced accordingly.
 As of 28 March 2018, the preference shares have traded excluding right to the last dividend of SEK 5 per preference share, which were resolved by the 2017 Annual General Meeting. Record date for this payment was 29 March 2018 and payment occurred on 5 April 2018. The cash consideration for the preference shares will not be adjusted downwards due to this dividend payment. In the event that Victoria Park pays dividends, in excess of the dividend amount described in the preceding two sentences or executes any other value transfer to its shareholders of preference shares, for which the dividend record date occurs before settlement in the Offer, the cash consideration for the preference shares will be reduced accordingly.