Beni Stabili S.p.A. SIIQ
(incorporated with limited liability in the Republic of Italy)
€225,000,000 3.375 per cent. Convertible Bonds due 2018
On 17 January 2013, Beni Stabili S.p.A. SIIQ (the Issuer) issued €175,000,000 3.375 per cent. Convertible Bonds due 2018 (the Original Bonds). On 14 March 2013, the Issuer issued €50,000,000 3.375 per cent. Convertible Bonds due 2018 (the New Bonds), which have been consolidated and form a single series with the Original Bonds (the Original Bonds and the New Bonds together, the Bonds). The Bonds will be redeemed on 17 January 2018 (the Final Maturity Date) at their principal amount but may be redeemed before then in certain circumstances subject to the terms and conditions of the Bonds (the Conditions). With effect from (and including) 24 June 2013 (the Physical Settlement Date) to (and including) the close of business (at the place where the relevant Bond is delivered for conversion) on 10 January 2018 (or, in the event of early redemption according to the Conditions, to the close of business on the seventh day before the date fixed for redemption), the holders of the Bonds (Bondholders) may exercise their Conversion Right to require conversion of their Bonds into new and/or existing ordinary shares of the Issuer currently with a par value of Euro 0.10 each (the Ordinary Shares) credited as fully paid. See “Terms and Conditions of the Bonds - Settlement and Conversion of Bonds”.
The Bonds bear interest from (and including) 17 January 2013 (the Closing Date) at the rate of 3.375 per cent. per annum calculated by reference to the principal amount thereof and payable semi-annually in arrear in equal instalments on 17 January and 17 July in each year (each an Interest Payment Date), commencing with the Interest Payment Date falling on 17 July 2013.
The Issuer may, at its option, redeem all, but not some only, of the Bonds at any time at their principal amount together with accrued interest, in the event of certain tax changes as described under "Terms and Conditions of the Bonds - Redemption and Purchase - Redemption for Taxation Reasons" as well as in certain other circumstances (see "Terms and Conditions of the Bonds - Redemption and Purchase -Redemption at the Option of the Issuer - Soft Call and Clean-up Call”).
Application has been made to the Luxembourg Stock Exchange for the listing of the Bonds on the Official List of the Luxembourg Stock Exchange and admission to trading on the Luxembourg Stock Exchange's Euro MTF market.
The Bonds are in registered form in principal amounts of €100,000 each, and are initially represented by a global certificate (the Global Certificate), without interest coupons, which has been deposited on 17 January 2013 in respect of the Original Bonds and on 17 March 2013 in respect of the New Bonds with a common depositary for Euroclear Bank SA/NV (Euroclear) and Clearstream Banking, société anonyme (Clearstream, Luxembourg). Interests in the Global Certificate will be exchangeable for definitive registered Bonds only in certain limited circumstances - see "Summary of Provisions relating to the Bonds while represented by the Global Certificate".
An investment in the Bonds involves certain risks. Prospective investors should have regard to the factors described under the heading "Risk Factors" on page 5.
The date of this Listing Circular is 13 June 2013
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This Listing Circular constitutes a prospectus for purposes of the Luxembourg law on prospectus securities dated 10 July 2005, as amended. It does not constitute a prospectus for the purposes of Article 3 of Directive 2003/71/EC (the Prospectus Directive).
This Listing Circular may only be used for the purpose for which it has been published.
The Issuer (the Responsible Person) accepts responsibility for the information contained in this Listing Circular. To the best of the knowledge of the Issuer (having taken all reasonable care to ensure that such is the case) the information contained in this Listing Circular is in accordance with the facts and does not omit anything likely to affect the import of such information.
This Listing Circular is to be read in conjunction with all documents which are deemed to be incorporated herein by reference (see "Documents Incorporated by Reference"). This Listing Circular should be read and construed on the basis that such documents are incorporated and form part of the Listing Circular.
The Issuer has not authorised the making or provision of any information or representation regarding the Issuer, the Group, the Bonds or the Ordinary Shares that is not contained in or not consistent with this Listing Circular and, if given or made, such information or representation must not be relied upon as having been authorised by the Issuer or any other person.
This Listing Circular (a) is not intended to provide the basis of any credit or other evaluation or (b) should not be considered as a recommendation by the Issuer or any other person that any recipient of this Listing Circular should purchase any Bonds. Each investor contemplating purchasing any Bonds should make its own independent investigation of the financial condition and affairs, and its own appraisal of the creditworthiness, of the Issuer. This Listing Circular does not constitute an offer or invitation by or on behalf of the Issuer to any person to subscribe for or to purchase any Bonds or the Ordinary Shares.
Neither the delivery of this Listing Circular nor the offering, sale or delivery of the Bonds shall in any circumstances imply that the information contained herein concerning the Issuer is correct at any time subsequent to the date hereof, or constitute any representation that there has been no adverse change, or any event reasonably likely to involve any adverse change, in the affairs or condition (financial or otherwise) of the Issuer since the date of this Listing Circular.
The distribution of this Listing Circular and any sale and/or delivery of the Bonds may be restricted by law in certain jurisdictions. Persons into whose possession this Listing Circular (or any part thereof) comes are required to inform themselves about, and to observe, any such restrictions and limitations. For a description of certain restrictions on sales and deliveries of Bonds and on the distribution of this Listing Circular in certain jurisdictions, see “Subscription and Sale”. Neither this Listing Circular nor any part thereof constitutes an offer to sell, or a solicitation of an offer to purchase, the Bonds or any of them and neither this Listing Circular nor any part thereof may be used for or in connection with an offer to, or the solicitation by, any person in any jurisdiction or in any circumstances in which such offer or solicitation is not authorised or to any person to whom it is unlawful to make such offer or solicitation. Accordingly, none of the Bonds may be offered or sold, directly or indirectly, and neither this Listing Circular nor any part thereof may be issued, distributed or published in any country or jurisdiction except in circumstances that will result in compliance with all applicable laws, orders, rules and regulations. Other than application for: (a) the approval of this Listing Circular by the Luxembourg Stock Exchange (the Stock Exchange), which does not assume any responsibility as to the economic or financial soundness of the transaction described in this Listing Circular or the quality or solvency of the Issuer, and (b) the admission of the Bonds to listing on the Official List of the Stock Exchange and to trading on the Euro MTF market of the Stock Exchange, no action has been taken or will be taken to permit a public offering of the Bonds (or any of them) or the distribution of this Listing Circular (or any part thereof) in any jurisdiction where action for that purpose is required.
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The Bonds have not been and will not be registered under the United States Securities Act of 1933, as amended, (the Securities Act) and are subject to U.S. tax law requirements. The distribution of this Listing Circular and the offer or sale of Bonds may be restricted by law in certain jurisdictions. Persons into whose possession this Listing Circular or any Bonds may come must inform themselves about, and observe, any such restrictions on the distribution of this Listing Circular and the offering and sale of Bonds. For a description of certain of these restrictions, see "Subscription and Sale".
All references in this document to euro and € refer to the currency introduced at the start of the third stage of European economic and monetary union pursuant to the Treaty establishing the European Community, as amended.
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TABLE OF CONTENTS
RISK FACTORS......
Risks relating to the Beni Stabili Group......
Risks relating to the performance of the real estate market......
Risks relating to the geographical concentration of the Group’s property assets......
Risks relating to the concentration of tenants......
Risks relating to competition in the real estate market......
Risks relating to pending disputes......
Risks relating to sources of funding......
Risks relating to interest rate fluctuations......
Risks relating to the Bonds......
The Bonds may not be a suitable investment for all investors......
Modification, waivers and substitution......
The claims of Bondholders are structurally subordinated with respect to subsidiaries......
The Bonds are not rated......
The Bonds may be redeemed prior to maturity......
Bondholders will bear the risk of fluctuation in the price of the Ordinary Shares......
Bondholders will have no right to acquire Ordinary Shares in case of conversion of the Bonds......
Bondholders will have no rights as shareholders until they acquire the Ordinary Shares in case of physical settlement upon conversion of the Bonds
Dilution of Bondholders’ rights......
No active trading market for the Bonds......
The secondary market generally......
Exchange rate risks and exchange controls......
Interest rate risks......
Legal investment considerations may restrict certain investments......
EU Savings Directive......
DOCUMENTS INCORPORATED BY REFERENCE......
TERMS AND CONDITIONS OF THE BONDS......
1Form, Denomination, Title and Status......
(a)Form and Denomination......
(b)Title......
(c)Status......
2Negative Pledge......
3Definitions......
4Registration and Transfer of Bonds......
(a)Registration......
(b)Transfer......
(c)Formalities Free of Charge......
(d)Closed Periods......
5Interest......
(a)Interest Rate......
(b)Accrual of Interest......
6Settlement and Conversion of Bonds......
(a)Settlement Period, Conversion Period and Conversion Price......
(b)Adjustment of Conversion Price......
(c)Retroactive Adjustments......
(d)Decisions and determinations of an Independent Financial Adviser or Calculation Agent......
(e)Share or Option Schemes......
(f)Rounding Down and Notice of Adjustment to the Conversion Price......
(g)Change of Control......
(h)Procedure for exercise of Settlement Rights and Conversion Rights......
(i)Ordinary Shares......
(j)Interest on Conversion......
(k)Purchase or Redemption of Ordinary Shares......
(l)Cash Alternative Election......
7Redemption and Purchase......
(a)Final Redemption......
(b)Redemption at the Option of the Issuer......
(i)Soft Call and Clean-up Call......
(ii)Redemption following non-passing of Shareholder Resolutions......
(c)Redemption for Taxation Reasons......
(d)Optional Redemption and Tax Redemption Notices......
(e)Redemption at the Option of Bondholders upon a Change of Control......
(f)Purchase......
(g)Cancellation......
(h)Multiple Notices......
8Payments......
(a)Principal......
(b)Other amounts......
(c)Record Date......
(d)Payments......
(e)Payments subject to fiscal laws......
(f)Delay in payment......
(g)Business Days......
(h)Paying, Transfer and Conversion Agents, etc......
(i)No charges......
(j)Fractions......
9Taxation......
10Events of Default......
(a)Non-Payment/Non-Delivery:......
(b)Breach of Other Obligations:......
(c)Cross-Acceleration:......
(d)Enforcement Proceedings:......
(e)Security Enforced:......
(f)Insolvency:......
(g)Winding-up:......
(h)Authorisation and Consents:......
(i)Analogous Events:......
(j)Illegality:......
11Undertakings......
12Prescription......
13Replacement of Bonds......
14Meetings of Bondholders, Modification and Substitution......
(a)Meetings of Bondholders......
(b)Modification of Agency Agreement......
(c)Substitution......
15Notices......
16Further Issues......
17Contracts (Rights of Third Parties) Act 1999......
18Governing Law and Jurisdiction......
(a)Governing Law......
(b)Jurisdiction......
(c)Agent for Service of Process......
SUMMARY OF PROVISIONS RELATING TO THE BONDS WHILE REPRESENTED BY THE GLOBAL CERTIFICATE
1.Exchange......
Notices......
Prescription......
Meetings......
Purchase and Cancellation......
Exercise of Settlement Rights/Conversion Rights/Optional Redemption upon Change of Control......
Events of Default......
Redemption at the Option of the Issuer or Cash Alternative Election......
Tax Election Option of the Bondholders......
USE OF PROCEEDS......
BUSINESS OF THE BENI STABILI GROUP......
OVERVIEW......
Property assets......
Risk management......
Recent development and prospects......
Employees......
Litigation and contingencies......
Legal disputes......
Tax disputes and audits......
Demand for settlement concerning acquisition of the investment in Immobiliare Fortezza S.r.l.....
Demand for settlement concerning acquisition of the investment in Montenero S.r.l......
Notice of IRES and IRAP tax assessment - tax year 2004......
Notice of assessment concerning disposal of the investment in Telemaco Immobiliare S.p.A......
Notice of IRES tax assessment - tax years 2002/2003......
Notice of IRES and IRAP tax assessment - tax year 2007......
Tax-assessment notice concerning the disputed offsetting of a VAT tax receivable......
Beni Stabili Development S.p.A. - Tax-assessment notice concerning the disputed offsetting of an IRES tax receivable
Beni Stabili Gestioni S.p.A. S.G.R. - Notices of IRES and IRAP tax assessment - tax years 2006, 2007 and 2009
Incorporation and status......
Board of Directors......
General......
Members of the Board of Directors......
Election of Board of Directors......
Committees......
Senior Management......
Board of Statutory Auditors......
General......
Members of the Board of the Statutory Auditors......
Appointment and Removal......
Independent Accountants......
Share capital......
Shareholders......
Authorised share capital increases......
Euro 225,000,000 3.875 per cent. Convertible Bonds due 2015......
The Bonds......
Paid-up and issued and Authorised Share Capital......
Listing......
EQUITY AND LIABILITIES......
SUMMARY FINANCIAL INFORMATION......
1.STATEMENT OF FINANCIAL POSITION......
2INCOME STATEMENT......
1.STATEMENT OF FINANCIAL POSITION......
2.INCOME STATEMENT......
TAXATION......
1.THE BONDS......
1.1Tax treatment of the Bonds......
1.1.1Italian resident Bondholders......
1.1.2Non-Italian resident Bondholders......
1.2Capital gains tax......
1.3Inheritance and gift taxes......
1.4Stamp duty......
1.5Wealth Tax on securities deposited abroad......
1.6Financial Transaction Tax......
1.7EU Savings Directive......
2.THE ORDINARY SHARES......
2.1Preliminary definitions......
2.2Dividends......
2.2.1Shareholders resident in Italy for income tax purposes......
Individual shareholders......
Partnerships, companies, commercial entities and non-commercial entities......
Tax-exempt entities......
Real Estate Funds......
Pension Funds......
Investment Funds and SICAVs......
2.2.2Shareholders resident outside of Italy for income tax purposes......
2.3Capital gains......
2.3.1Shareholders resident in Italy for income tax purposes......
Individual shareholders holding the shares not in connection with a business activity......
Sale of a Qualified Shareholding......
Sale of a Non-Qualified Shareholding......
Individuals shareholders holding the shares in connection with a business activity, partnerships and similar entities
Companies and commercial entities......
Investment Funds and SICAVs......
2.3.2Shareholders resident outside of Italy for income tax purposes......
2.4Inheritance and gift taxes......
2.5Stamp duty......
2.6Wealth Tax on securities deposited abroad......
2.7Financial Transaction Tax......
DESCRIPTION OF THE ORDINARY SHARES......
General......
Form and transfer of the Ordinary Shares......
Dividends......
Shareholders’ Meetings......
General......
Publication of notice convening the meetings......
Right to participate and exercise voting rights in meetings......
Right to put additional items to the agenda; right to ask questions......
First, second and third calls......
Ordinary shareholders’ meetings......
Extraordinary shareholders’ meetings......
Proxies, proxy solicitation and representative......
Challenge of resolutions and right to redemption of shares......
Pre-emptive Rights......
Purchase of the Issuer’s Own Shares......
Rights of the shareholders upon liquidation......
Action against the directors......
Other minority shareholders’ rights......
SUBSCRIPTION AND SALE......
United States......
United Kingdom......
Republic of Italy......
General......
Purchase of Bonds......
GENERAL INFORMATION......
Authorisations......
Placement, listing and admission to trading......
Clearing Systems......
No significant change......
Litigation......
Auditors......
Representative of the Bondholders......
Legend concerning US Persons......
Documents Available and Notices......
Yield......
THE ISSUER......
PRINCIPAL PAYING, TRANSFER AND CONVERSION AGENT, CALCULATION AGENT, REGISTRAR and LUXEMBOURG LISTING AGENT
LEGAL ADVISERS......
To the Issuer as to Italian law......
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RISK FACTORS
The Issuer believes that the following factors may affect its ability to fulfil its obligations under the Bonds. All of these factors are contingencies which may or may not occur and the Issuer is not in a position to express a view on the likelihood of any such contingency occurring. In addition, certain factors which are material for the purpose of assessing the market risks associated with the Bonds are described below. Each of the risks highlighted below could adversely affect the trading price of the Bonds or the Ordinary Shares, or the rights of the investors under the Bonds or the Ordinary Shares and, as a result, investors could lose some or all of their investment.
The Issuer believes that the factors described below represent the principal risks inherent in investing in the Bonds, but the inability of the Issuer to pay interest, principal or other amounts on or in connection with the Bonds may occur for other reasons which may not be considered significant risks by the Issuer based on information currently available to it or which it may not currently be able to anticipate. Prospective investors should also read the detailed information set out elsewhere in this Listing Circular and reach their own views prior to making any investment decision.
Words and expressions defined in "Terms and Conditions of the Bonds" shall have the same meanings in these risk factors.
Risks relating to the Beni Stabili Group
Risks relating to the performance of the real estate market
The Italian and international real estate market experiences a cyclical trend and is influenced by a series of variable macroeconomic factors. Market demand and supply are in particular affected by, amongst others, general economic conditions, interest rate fluctuations, inflation trend, tax regime, market liquidity and alternative investment opportunities.
In the last few years the Italian real estate market has been negatively affected by the difficult European economic situation, resulting in pressure on real estate values and depressed investment market conditions in general. Despite this and the significant impact of the IMU tax amendments introduced in 2012, the Beni Stabili Group operating results performed positively and the financial structure was reinforced. However, the variation at fair value of the Group’s property assets as a result of the ongoing crisis in the Italian and international property market has resulted in a Euro 83.5 million write-down of properties, compared to a Euro 79.2 million write-down in 2011. As a consequence of such factors and despite good performance of the operational activities and savings on operating costs, the net Group result in 2012 amounted to a loss of €15.7 million, compared with a profit of €18.8 million in 2011 (the 2011 result was influenced positively by the release of provisions for €42 million).