Club Mediterranee and Gecina Group have carried out a transaction, under which Gecina will acquire the property assets of four Club Med villages (Val d'Isere, Peisey-Vallandry, La Plagne 4 and Opio).
The transaction amounts to a total of E225 million, including E33 million in renovation work financed by Gecina at the La Plagne 2100 and Opio villages.
A 12 -year lease agreement , renewable at Club Mediterranee's option, has been signed with gecina, with a net rent equivalent to 7% of the transaction price.
For Club Mediterranee, the transaction is part of the implementation of its new strategy and will enable it to refinance, on attractive terms, four of its most beautiful villages: Val d'Isere, which was recently renovated, Peisey-Vallandry, which will open this winter, and La Plagne 2100 and Opio, which will soon be renovated. All of these villages illustrate the Group's move upmarket.
The transaction demonstrates Gecina's commitment to increasing its portfolio by investing in commercial and residential real estate, as well as in new assets such as hotels.
"This transaction represents the first phase in the strategy of diversifying our business," said Joaquin Rivero Valcarce, Gecina Chairman and Chief Executive Officer. "It has enabled us to forge a long-term partnership with Club Mediterranee, the world leader in upscale all-inclusive vacations. We want to increase and energize our asset portfolio by investing in high quality real estate products to improve group performances."
At the signing, Club Mediterranee Chief Executive Officer Henri Giscard d'Estaing emphasized that "this transaction, which is part of the implementation of our new upmarket strategy, has given Club Mediterranee additional resources and greater financial flexibility to successfully deploy this strategy. I am pleased that this transaction is being carried out with a partner as prestigious as Gecina, France's leading real estate investment company."
Gecina is France's foremost listed property company investing in commercial and residential rental properties and a leader in the euro zone, with real estate holdings valued at nearly E9 billion (unit value as at June 30, 2005). A portfolio of 18,400 apartments and more than one million square meters of office and retail space gives the Group a unique profile, combining profitable return and safe investment. Listed on Euronext Paris, Gecina has a market value of E6 billion.
Created in 1950, Club Mediterranee is today the world leader in all-inclusive vacations. Positioned in the friendly, multicultural upmarket segment, it has operations in forty countries on five continents, with 80 villages and the Club Med 2 cruise ship. Through its Jet tours brand, Club Mediterranee proposes a wide variety of tours, vacations and weekends around the world. In 2004, the Group welcomed 1.7 million customers and achieved revenues of 1 600 millions euros. The Club Mediterranee share is traded on the Euronext Paris market.
By: N. Peter Kramer
