24th Sep 2013 08:53
LONDON (Alliance News) - CLS Holdings PLC Tuesday said its stake in Catena AB will reduce to 13.8% from 29.99% after the Swedish company issues new shares to pay for a GBP112 million portfoliop of logistics and warehouse properties.
Under accountancy rules, the stake reduction means that Catena will no longer be classed as an associate in CLS' accounts and will be accounted for as an available-for-sale investment.
CLS will therefore account for dividends received from Catena, and will revalue its investment to fair value at each balance sheet date by reference to Catena's share price. At Monday's closing price of Catena's shares, such a revaluation would increase the group's pro-forma net assets by GBP14.9 million, or 35 pence a share.
"This transaction is very good news for shareholders of Catena and of CLS as it enables Catena to move forward to maximise the development opportunity at Haga Norra, Stockholm, with a reduced investment risk profile," CLS Chairman Sten Mortstedt said in a statement. "The 23% rise in the Catena share price following the announcement of the acquisition is evidence of the market's positive view on the transaction."
CLS Holdings shares last traded at 1,168 pence.
By Steve McGrath; [email protected]; @SteveMcGrath1
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