2015-09-01 09:06:13

Signing of a letter of intent concerning the terms and methods of optimising the use of GPW's non-core real estate assets

Current Report No. 19/2015

Date: 1.09.2015

Topic: Signing of a letter of intent concerning the terms and methods of optimising the use of GPW's non-core real estate assets

Legal basis: Article 56(1)(1) of the Act on Offering - inside information

Content of the report:
The Management Board of the Warsaw Stock Exchange ("GPW", "Exchange", or "Company") announces that on 31 August 2015 it signed a non-binding letter of intent with:
- MS Towarzystwo Funduszy Inwestycyjnych S.A. ("MS TFI"), a member of the Polska Grupa Zbrojeniowa S.A. Group which is 100% held by the State Treasury of the Republic of Poland; MS TFI manages the closed-ended investment fund MARS Fundusz Inwestycyjny Zamknięty - the majority shareholder of Centrum Bankowo-Finansowe "Nowy Świat" S.A.,
and
- Centrum Bankowo-Finansowe "Nowy Świat" S.A., the majority shareholder of Centrum Giełdowe S.A. ("CGSA"); CGSA is the co-owner (together with GPW) of the office building Centrum Giełdowe ("CG"), which houses among others the head office of GPW

in order to start joint analyses and negotiations concerning the methods and the terms of optimising the use of GPW's real estate assets, including office space, in view of current operating expenses, capital expenditures, the investment of capital, available operational flexibility, and creation of the shareholder value.

As part of the aforementioned work, the analyses and negotiations may also cover the terms and conditions of GPW's potential divestment of a 24.79% stake in CGSA, real estate owned separately by GPW within CG, GPW's share in the property right in CG and in the perpetual usufruct for the plots of land on which CG is situated, to CGSA or another member of the MS TFI Group, combined with the signing by GPW of a long-term lease agreement for space within Centrum Giełdowe.
The signing of the letter of intent and the start of the aforementioned joint work is part of the strategy of enhancing the operating efficiency of the GPW Group, whereby the Exchange is currently running among others a project of relocating the head offices of GPW's subsidiaries to Centrum Giełdowe at 4, Książęca Street, Warsaw. The intention of the GPW Management Board is to further optimise the office space and real estate assets used by GPW while fully securing the interests of GPW in the availability of office space in the existing head office at 4, Książęca Street, Warsaw in the next 5-10 years.

As at the date of this report, GPW's real estate assets included ownership of separate premises situated within the Centrum Giełdowe building complex (three floors), including among others the Company's offices and conference rooms with a total floor area of 6,782.25 m2 (excluding the share in space under shared ownership). Furthermore, the Company owns 2,032.32 m2 of the neighbouring real estate which accommodates the underground car park of Centrum Giełdowe. The total area of both pieces of real estate which make up the Centrum Giełdowe building complex including space under shared ownership is 35,078.36 m2.

A customary legal, technical and commercial due diligence of the Centrum Giełdowe building will be performed in order to implement the provisions of the letter of intent. According to information provided by MS TFI to the Company, the due diligence will cover among others the correctness of the acquisition and the legal status of the real estate. The rights to real estate within the Centrum Giełdowe building complex were acquired by GPW on 20 December 2001 in implementation of the preliminary agreement of 2 February 1998 whereby CGSA and the Company were obliged to conclude an agreement establishing separate ownership of commercial premises in the Centrum Giełdowe building complex and the sale of such premises as well as the sale of stake in separate real estate comprised of an underground car park. After the completion of the Land and Mortgage Register proceedings by the registration court, including the clarifications concerning necessary corporate approvals provided by the Company as part of the proceedings, the ownership rights in the real estate within the Centrum Giełdowe building complex acquired by the Company under the agreement with CGSA were duly entered into the Land and Mortgage Register.

In addition, the Company previously leased within Centrum Giełdowe 1,373.65 m2 of floor area (conference rooms and archive), which was largely terminated by the Company as of 1 September 2015. In addition, GPW holds 46,506 shares of CGSA (24.79% of the share capital), which is the majority owner of the Centrum Giełdowe building complex.

It is the objective of the parties to the letter of intent to complete the aforementioned analyses and negotiations no later than the end of 2015; the approval and commencement of the implementation of potential transactions could begin no earlier than Q2 2016 following relevant future decisions of the GPW Management Board and required corporate approvals, including approvals of GPW shareholders. At this time, no such decisions or approvals have taken place.

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