Ablon Group Limited : Interim Management Statement

FOR RELEASE AT 16 May2013

ABLON GROUP LIMITED

INTERIM MANAGEMENT STATEMENT

For the period from 1 January 2013 to 16 May 2013

ABLONGroup Limited ("ABLON" or the "Company" and, together with its subsidiaries, the "Group"), a leading real estate owner and developer in Central Europe, today announces its Interim Management Statement for the period from 1 January 2013 to 16 May 2013.

Alex Borrelli, Chairman of ABLON, commented:

"While the overall depressed economic environment did not ease in the period, the direct operational environment has remained stable.

The recommended cash offer for ABLON by CPI Group, a.s. ("CPI") currently being implemented is providing the Company with new possibilities for improving operational effectiveness through realising synergies between the operations of CPI and ABLON.

As a result, the Company's financial stability has been improved through a series of loan transactions that resulted in the prolongation of expired loans, loan repayments and a loan increase that was agreed in the period.   

Takeover and delisting

On 22 February 2013, CPI announced a mandatory cash offer of 22.5 pence for each ordinary share in the Company following its aggregate holding increasing to 50.89%.  On 17 April 2013, CPI extended its then recommended cash offer having received acceptances and owning shares representing in aggregate 92.87% of the Company.

On 23 April 2013, ABLON announced that it was applying to the UK Listing Authority for the removal of its shares from the Official List of the UK Listing Authority and to the London Stock Exchange plc for the cancellation of trading in its shares on the Main Market which is expected to take effect at 8.00am on 31 May 2013.

Loan transactions

On 21 March 2013, a number of expired loans, held within the Group with a total capital amount of €29.4 million ("Expired Loan Portfolio"), were transferred from Volksbank AG ("Volksbank") to CPI Beta a.s. ("CPIB").  Whilst completion of the transfer was a matter between Volksbank and CPIB, the Group had previously consented to the transfer.

The Expired Loan Portfolio consisted of eight expired loans on the following projects:

·      Hightech Park, Hold, Katona, Nap projects in Hungary;

·      Kolben, May House and Ritka project in the Czech Republic; and

·      Mogosaia project in Romania.

The expired loans were prolonged by CPIB until 21 September 2014 with the interest rate being maintained at the same level as that of the expired loans. CPIB has waived a €0.8 million penalty interest which has accrued on some of the loans.

In addition, as part of the agreement entered into between Volksbank and CPIB, Volksbank has agreed to alter the terms of some of the remaining loans in place between Volksbank and the Company on the request of the subsidiary company holding the loan ("Loan Agreement"), including:

·      an assignment agreement with Volksbank whereby the Company purchased €1.25 million loan on the Buyway Soroksár project for a consideration of €1

·      a €5.5 million increase on the loan granted to Global Immo Kft by Volksbank AG ("Volksbank") ("Gateway Loan Increase"). Out of the loan increase €1.8 million was used to fully repay two long term Ablon Group loans, being loans in respect of the Fogarasi and Hightech Park projects, and €3.7 million served as additional liquidity. The interest on the Gateway Loan Increase is at 2% above the 3 month Euribor.

·      an extension of 30 months to a loan granted to Airport City Ingatlanbefektetesi Kft that would otherwise have expired on 30 April 2013.

The Company has also assumed a corporate guarantee to Volksbank in respect of the repayment of the principal and interest of the Buyway Dunakeszi and Buyway Soroksár loans.

Other announceable events in the period

·      Under its cooperation agreement with CPI Group, a.s., details of which were announced on 10 April 2013, excess financial liquidity of the Group is transferred to CPI Group a.s. The current balance of the loan to CPI Group, a.s. is €6.6 million and the Group has €3.7 million in cash on company accounts.

·      The Company secretary, Ardel Fund Services Limited has changed its name to JTC Fund Administration (Guernsey) Limited."

Portfolio summary

Rental activities

1Offices and storages in own use are included in the annualised rental income of BC 30 and Meteor, contributing to a total annualised gross rent of €0.2 million p.a. as at 16.05.2013 (31.12.2012: €0.2 million)

Residential activities

Hotel activities

Unaudited operative results for the three months of operations ended 31 March 2013 show a €0.2 million segment loss for the Marriott Courtyard Hotel, Budapest (€0.3 million segment loss for the same period in 2012).

Enquiries:

Alex Borrelli / Adrienn Lovro

Ablon Group Limited

+44 7747 020 600/+36 1 225 6600

Roland Cornish / Emily Staples

Beaumont Cornish Limited

+44 (0) 207 628 3396

About ABLON Group Limited

Founded in 1993 in Budapest (Hungary), ABLON and its subsidiaries (together the "ABLON Group") has properties at 33 locations, of which there are 15 completed projects and 23 development projects in Budapest, Prague, Bucharest and Warsaw. Its portfolio comprises a diversified mix of office, residential, retail, logistics and hotel developments valued at approximately €370 million by external independent appraiser (Colliers International) as at 31 December 2012. The ABLON Group had, as at 31 December 2012, approximately 208,800 square metres of existing and income generating office, residential, hotel, retail and logistics assets (at 15 locations) in Budapest and Prague, with a significant development land bank comprising a further circa. 1,164,500 square metres (at 23 locations) in Budapest, Prague, Bucharest and Warsaw. ABLON's shares are traded on the Main Market of the London Stock Exchange under the ticker 'ABL'.