PPF Group establishes Real Estate Group - PPF ECM Holding
PPF ECM Holding N.V. is hoped to have a strong local market position and will become a market leader in the Central and Eastern Europe (CEE) real estate sector. PPF Group N.V. will control 75% and Milan Janků 25% of voting rights in the new holding company. The transaction will be completed following the necessary approvals from the Office for the Protection of Competition.
Unlike its competitors, PPF ECM Holding will have a presence across all sections of the real estate market; from land acquisition to development, to construction facility management, real estate private equity and asset management. This integrated approach will enable the new company to maximise cash flow and re-investment in other ongoing projects. FCP, a newly formed specialised property fund headquartered in Luxembourg, will facilitate this capital re-investment. It will enable the shareholders of the PPF ECM Holding to unblock a part of the capital invested in projects and retain control over them through a majority interest in the specialised fund.
All of PPF ECM Holding projects will be managed by expert teams from PPF ECM Advisory Company a subsidiary of the PPF ECM Holding with offices in Prague, Moscow and Beijing. Regional management will be structured as follows: Tomáš Krones will direct Central and Eastern Europe, Tomáš Laštovka will direct Russia and Maroš Bréda will be responsible for China. Kamil Ziegler will be the Chief Financial Officer and will hold the general powers of attorney for the company.
There are 42 projects in the PPF ECM Holding portfolio as of its foundation. PPF Group has contributed the complete portfolio of its real property projects and Milan Janků has contributed the realtor assets of ECM Group N.V., except for ECM REI, and other businesses and minority shares in projects including PSJ, Domus Eventis, and Carrefour SK. Milan Janků retains his majority interest in ECM Group.
„The Joint Venture has three key cornerstones that will lead to a more integrated and powerful implementation of real estate projects going forwards. Firstly, the combination of PPF and ECM’s commercial property market expertise; the mutual synergies that result from the combination of their various assets and finally, the financial strength of PPF Group. When combined these give the joint venture a high degree of competitiveness and added value in the marketplace and this is exactly what prompted my decision to merge with PPF.” said Milan Janků, shareholder of PPF ECM Holding.
Jiří Šmejc, shareholder of PPF Group N.V. added: “We want to capitalise on the current opportunities offered by the real estate market and seek to expand the Group further into the market whilst it is underperforming. In the current financial crisis, both PPF and Milan Janků believe that it makes sound commercial sense to build a development platform that can both support major acquisitions and that can offer professionally managed financial aid to companies.”
The creation of PPF ECM Holding will not, in any respect, affect ECM REAL ESTATE INVESTMENTS A.G. or the public tradability of the company’s shares registered at the Prague Stock Exchange (Burza cenných papírů Praha). ECM GROUP N.V. as a majority shareholder of ECM REAL ESTATE INVESTMENTS A.G. does not plan to withdraw the shares from the market. Milan Janků will retain control over ECM REAL ESTATE INVESTMENTS A.G. through a majority interest in ECM GROUP N.V.