Elbit Medical Group Selling Four Centers in Hungary

For more retail coverage, click GlobeSt.com/RETAIL.

TEL-AVIV, ISRAEL-The Plaza Centers subsidiary of locally based and publicly traded Elbit Medical Imaging Ltd. has agreed to sell four shopping and entertainment centers in Hungary to Dawnay Day Europe Limited for euro 56.5 million ($72 million) in cash and debt. The cash portion of the purchase price is euro 16.7 million ($21.3 million), which is equal to the asset value of the centers minus financing and other liabilities of the companies owning the centers. Per the agreement, Dawnay Day Europe (part of the Dawnay Day Group) will acquire 100% of the voting rights in the companies owning the properties, and Plaza Centers will guarantee certain portions of the rental revenues for a period of between one and three years from closing. The aggregate amount of the guarantee is estimated at euro 1.4 million ($1.8 million). The purchase and sale agreement is subject to a previous agreement between Plaza Centers and Klepierre Group. The two in July agreed to terms for the sale of 12 centers in Hungary and, per that agreement, Klepierre can match the terms agreed to by Plaza Centers and Dawnay Day and buy the assets itself.Klepierre Group has 60 days to exercise its rights of first offer. If Klepierre does not elect to purchase the properties, it is anticipated Dawnay Day will close on the assets in early 2005. The sale will leave Plaza Centers with three operational shopping and entertainment centers in Poland, office buildings in Hungary and the Czech Republic, and eight additional projects in various stages of development, planning and construction in Poland, the Czech Republic, Latvia and Greece. In addition, Plaza Centers retains rights in a project in its initial planning stages to be executed on the Obuda Island in the Danube River in central Budapest, which entails the proposed construction of 3.5 million sf designated for offices, commercial use, tourism and hotels.