Presentation   material fact (memorandum of understanding)
Upcoming SlideShare
Loading in...5

Presentation material fact (memorandum of understanding)






Total Views
Views on SlideShare
Embed Views



0 Embeds 0

No embeds


Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
Post Comment
Edit your comment

Presentation   material fact (memorandum of understanding) Presentation material fact (memorandum of understanding) Presentation Transcript

  • Proposal of Portfolios Merger
  • Transaction2MergerManagement and CapitalMarketsOwnershipBoard of Directors 100% BTG-WT Properties merger through the issuance of new shares (BRPR3); Maintenance of BR Properties´ Management; Ticker will be maintained under BRPR3 in the Bovespa Novo Mercado; ~58.1% current BR Properties shareholders; ~41.9% current BTG-WT shareholders + New Investors; 7 Directors, of which: 3 chosen by BRPR shareholders; 3 chosen by BTG-WT shareholders; 1 independent.Main Financial IndicatorsClosing of theTransaction 2013 Revenues over R$ 1.0 Bi 2013 EBITDA: R$ 900 mm Initial Cash Balance: R$ 1.5 BiNet Debt: R$ 2.9 Bi Until December 2011.
  • Rationale: Summary3Consolidation as the largest commercial properties company of the countrywith a portfolio of R$ 10 billion of market value and approximately 2 millionm² of GLABetter PortfolioPositioningTenants DiversificationBetter MarketPositioning Irreplicable portfolio, present in 14 states, and mainly concentrated in the best and mostliquid regions of the country;Synergies of the MergerSolid Cash Balance Higher diversification on the tenants base; Partner of choice of leading companies, for co-development and build-to-suit operations; Higher bargain power towards the tenants and to the debt markets; The new company will be substantially larger than all market competitors; Scale Gains → SG&A dilution and more efficiency in the management of the portfolio´sproperties, resulting in higher operational margins; 100% of the transaction through exchange of shares, preserving an initial cash balanceof approximately R$ 1.5 billion, and maintaining a strong investment capacity.
  • Rationale: Portfolio Positioning4Irreplicable portfolio, present in 14 states, and mainly concentrated in thebest and most liquid regions of the country— Office: 44— Warehouse: 38— Developments: 12— Retail: 30— Landbank: 2 Number of Properties : 126 Total Properties GLA: 2,099,906 m2— Office: 397,055 m²— Warehouse: 1,150,385 m²— Developments: 393,664 m²— Retail: 123,410 m²— Landbank: 35,392 m²Portfolio Breakdown – Market Value Portfolio Breakdown – Existing Properties/Development (%GLA)OfficeWarehouseBRPRRetailPortfolio Breakdown – Footprint80%20%Developments87%13%Existing Properties67,2%20,6%12,2%São Paulo Rio de Janeiro Others38,9%25,3%5,4%29,0%1,5%OfficeWarehouseRetailDevelopmentsLandPre-Merger Post-Merger% GLA
  • Rationale: Tenants Diversification5Tenant base includes some of the best known Companies in the country,spanning wide industry diversificationAmong otherhigh qualitytenantsMain Tenants ( % Total Revenues )11,0%5,9%4,0% 4,0% 3,3%Petrobrás Vivo C&A Unilever BTG
  • 10.1172.515 2.244BR Properties CCP São CarlosRationale: Market Positioning6The Company has a proven track record as the consolidator of a highlyfragmented marketAddressable Market1: 36.3 mm m2BRProperties10 OrganizedCompanies58%OrganizedCompanies11%Non-OrganizedMarket89%After Merger42%Fragmented Industry (in terms of GLA - m2)1 Including existing properties only1 Not including retail propertiesBRPR vs Competitors (in terms of PortfolioMarket Value – R$ Bi)4,0x 4,5x
  • Rationale: Synergies of the Merger7Significant synergy gains both on the revenues side and operationalexpenses dilution Scale Gains → SG&A dilutionMain Financial Indicators2013 RevenueApproximatelyR$ 1 billion2013 EBITDAApproximatelyR$ 900 millionInitial Cash BalanceApproximatelyR$ 1.5 billion More efficiency in the management of the portfolio´s properties, resulting in higherfinancial and operational margins;EBITDA Margin90,2%91,7%93,6%2011 2012 2013
  • Rationale: Solid Cash Balance8Transaction 100% through shares exchange, preserving an initial cashbalance of R$ 1.5 billionPipeline (R$ mm)Loan to Value (Net Debt)Transaction with no cash deployment;Strong buying power to take advantage of currentopportunities in the market;Initial Cash Balance of R$ 1.5 Bi.10.11714.7293.220762450 180CurrentPortfolioOffice Build-to-Suit Retail Industrial Total32%35%34%31%27%22%16%0%10%20%30%40%50%2011 2012 2013 2014 2015 2016 2017
  • Portfolio´s Pricing at NAV Valuation by type and quality of the properties based on potential revenues: Properties under development to be delivered within 24 months: Priced as existing properties, discounted by the reminiscent value of CAPEX; Future value discounted at 6.9% p.y. (real capital cost); 3 months of vacancy after delivery; Properties under development to be delivered after 24 months, appraised at land cost; Average Cap on Cost 16.13% Liquidity discount on the NAV of BTG-WT´s portfolio; Tax losses carried forward; Adjustments to the cost of debt in order to equalize the differences of the cost of capital.Valuation9Considered Assumptions for the Valuation Triple A Office Buildings: 9.0%; Class A Warehouses: 9.5%; Retail: 9.5%; Class A Office Buildings: 10.0% Other Warehouses: 10.0%
  • Combined PortfolioGross Leasable Area (m²) Market Value (R$ mm)BRPR BTG Combined297.959397.055773.0271.150.385108.070123.410179.186393.66435.39299.096377.35815.340214.47835.392Office Warehouse Retail Developments Land1,358,242 m²741,665 m² 2,099,906 m²BRPR BTG CombinedR$2.726R$3.937R$1.676R$2.555R$445R$544R$319R$2.931R$150R$1.210R$879R$99R$2.611R$150Office Warehouse Retail Developments LandR$ 5,167R$ 4,949 R$ 10,117
  • Merger / Corporate GovernanceMain Points For Approval: Transaction is subject to satisfactory due diligence for BR Properties and the exercise of the right ofwithdrawal by up to 10% of BRPR´s shareholders; Financial Institution’s fairness opinion to the Board; BRPR´s shareholders’ approval; Board of Directors comprised of 7 members, of which one is independent; Introduction of the following changes to the Company´s Bylaws:1. The company will be ruled, for at least 30 months, according to a Business Plan which will describe the currentmanagement structure, the portfolio´s composition, investment policy, indebtedness limits, acquisition and saleof assets. The Plan can only be modified prior to 30 months if approved by at least 6 out of the 7 members ofthe Board of Directors;2. The current management’s term of office will be renewed for additional 3 years;3. The management can only be modified if approved by at least 6 out of the 7 Directors;4. Acquisition, indebtedness and sale of properties matters can only be submitted to the Board of Directors ifunanimously approved by the management;5. Maintenance of the remaining bylaws dispositions;6. In case of conflict of interest between shareholders, conflicted parties cannot vote.